HRB FINAL EXAM |COMPLETE QUESTIONS WITH 100% RATED
EXPERT SOLUTIONS |2026 LATEST UPDATED
What is the Difference between earned income and unearned income? - (answer)Earned income
is received for services performed. Examples are wages commissions, tips and generally farming
and other business income . Taxable income other than that received for services performed.
Unearned Income includes money received ro the investment of money or other property, such as
interest, dividends, and royalties. It also includes pensions alimony, unemployment
compensation and other income that is not earned
If an employee thinks their Form W2 is incorrect, what should they do? - (answer)Employee
should discuss with employer who issued the document and request a W2C. If no help from
employer, notify IRS. Tax prepaper can then file a substitute.
What information do you need to know to determine whether a taxpayer is required to file a
return? - (answer)Gross income, filing status, age and if they are a dependent
For tax purposes, when is a person's marital status determined? - (answer)On the last day of the
tax year
,Where on the tax form can you find the regular standard deduction amounts? - (answer)Line 22
on 1040A, In the left margin at the top of the page 2 of forms 1040 and 1040A. Look at actual
form to look for line
How much is added to the standard deduction if the taxpayer (or spouse is age 65 or older, or
blind? - (answer)$1550 if unmarried, $1250 if married
What is the personal exemption amount for 2016? - (answer)$4,050
What two amounts are combined to make up the gross income filing requirments for most
taxpayers? - (answer)The standard deduction and the personal exemption amounts
Under what circumstances might a taxpayer be required to file a return even though they do not
meet the gross income filing requirements? - (answer)1. Has net employment of $400 or more
net self employment 2. You had unemployment income you owe medicare Advantage MSA,
receive HAS, Archer, MSA 3. Reeived an Advanced Premium Tax credit even if they didn't
otherwise have a filing requirment for the year *Tips, HSA, SE $400, PTC
What is the difference between injured spouse allocation and innocent spouse relief? -
(answer)The difference between injured spouse and innocent spouse is significant in the eyes of
the IRS. Both release you from an income tax liability arising from a "married filing jointly"
,return but different outcomes. Innocent spouse filed a joint return byt was unaware that their
spouse deliberately under reported tax liability. Injured spouse seeks to protect his or her share of
the refund in case it gets seized or offset due to the other spouse's debts or unpaid obligations
CHAPTER 3: DEPENDENT EXEMPTIONS AND SUPPORT - (answer)
What four requirements must be met for an individual to be claimed as a dependent -
(answer)Must pass the dependent test, joint return test, citizenship, qualifying child or relative
What are the five tests for a qualifying child? - (answer)1. Relationship 2. Age 3. Residency 4.
Support 5. Joint Return
How can a married individual meet the joint return test to remain a qualifying child? -
(answer)They can meet this test by not filing a joint return with their spouse or they can file a
joint return with their spouse if they are filing only to claim a refund on any taxes withheld
How can you determine who paid more than half of a person's support? - (answer)Total support
is determined and reduced by the funds received by and for the person from all sources other
than the taxpaer. The remaining support is considered to be provided by the taxpayer. Other
sources might include government support Worksheet for Determining Support
, What happens if an individual is a qualifying child of more than one taxpayer? -
(answer)Generally, the custodial parent is the one in which the child spent the most nights
What happens when more than one taxpayer claims the same qualifying child? - (answer)Tie
Breaker Rules apply : 1. The parent, if only one of the persons is the childs parent 2. The parent
with whom the child lived the longest during the tax 3. The parents with the highest AGI if no
parent can claim the child as a qualifying child
What four tests must be met for an individual to be considered a qualifying relative? - (answer)1.
Not be a qualifying child, the person cannot be the taxpayers qualifying child or the qualifying
child of another taxpayer 2. Relationship: Child, brother, sister, step sister, step brother, step
father , step mother, in-laws 3. Gross Income: gross income must be less than $4050 4. Support:
Taxpayer must provide more than half the support
How can the gross income for a qualifying relative test be satisfied? - (answer)Gross income
must be less than $4050 (Do not include tax exempt income)
What is the purpose of Form 2120 Multiple Support Declaration? - (answer)You only need 2120
multiple support declaration if you are claiming someone other than a qualifying child as a
EXPERT SOLUTIONS |2026 LATEST UPDATED
What is the Difference between earned income and unearned income? - (answer)Earned income
is received for services performed. Examples are wages commissions, tips and generally farming
and other business income . Taxable income other than that received for services performed.
Unearned Income includes money received ro the investment of money or other property, such as
interest, dividends, and royalties. It also includes pensions alimony, unemployment
compensation and other income that is not earned
If an employee thinks their Form W2 is incorrect, what should they do? - (answer)Employee
should discuss with employer who issued the document and request a W2C. If no help from
employer, notify IRS. Tax prepaper can then file a substitute.
What information do you need to know to determine whether a taxpayer is required to file a
return? - (answer)Gross income, filing status, age and if they are a dependent
For tax purposes, when is a person's marital status determined? - (answer)On the last day of the
tax year
,Where on the tax form can you find the regular standard deduction amounts? - (answer)Line 22
on 1040A, In the left margin at the top of the page 2 of forms 1040 and 1040A. Look at actual
form to look for line
How much is added to the standard deduction if the taxpayer (or spouse is age 65 or older, or
blind? - (answer)$1550 if unmarried, $1250 if married
What is the personal exemption amount for 2016? - (answer)$4,050
What two amounts are combined to make up the gross income filing requirments for most
taxpayers? - (answer)The standard deduction and the personal exemption amounts
Under what circumstances might a taxpayer be required to file a return even though they do not
meet the gross income filing requirements? - (answer)1. Has net employment of $400 or more
net self employment 2. You had unemployment income you owe medicare Advantage MSA,
receive HAS, Archer, MSA 3. Reeived an Advanced Premium Tax credit even if they didn't
otherwise have a filing requirment for the year *Tips, HSA, SE $400, PTC
What is the difference between injured spouse allocation and innocent spouse relief? -
(answer)The difference between injured spouse and innocent spouse is significant in the eyes of
the IRS. Both release you from an income tax liability arising from a "married filing jointly"
,return but different outcomes. Innocent spouse filed a joint return byt was unaware that their
spouse deliberately under reported tax liability. Injured spouse seeks to protect his or her share of
the refund in case it gets seized or offset due to the other spouse's debts or unpaid obligations
CHAPTER 3: DEPENDENT EXEMPTIONS AND SUPPORT - (answer)
What four requirements must be met for an individual to be claimed as a dependent -
(answer)Must pass the dependent test, joint return test, citizenship, qualifying child or relative
What are the five tests for a qualifying child? - (answer)1. Relationship 2. Age 3. Residency 4.
Support 5. Joint Return
How can a married individual meet the joint return test to remain a qualifying child? -
(answer)They can meet this test by not filing a joint return with their spouse or they can file a
joint return with their spouse if they are filing only to claim a refund on any taxes withheld
How can you determine who paid more than half of a person's support? - (answer)Total support
is determined and reduced by the funds received by and for the person from all sources other
than the taxpaer. The remaining support is considered to be provided by the taxpayer. Other
sources might include government support Worksheet for Determining Support
, What happens if an individual is a qualifying child of more than one taxpayer? -
(answer)Generally, the custodial parent is the one in which the child spent the most nights
What happens when more than one taxpayer claims the same qualifying child? - (answer)Tie
Breaker Rules apply : 1. The parent, if only one of the persons is the childs parent 2. The parent
with whom the child lived the longest during the tax 3. The parents with the highest AGI if no
parent can claim the child as a qualifying child
What four tests must be met for an individual to be considered a qualifying relative? - (answer)1.
Not be a qualifying child, the person cannot be the taxpayers qualifying child or the qualifying
child of another taxpayer 2. Relationship: Child, brother, sister, step sister, step brother, step
father , step mother, in-laws 3. Gross Income: gross income must be less than $4050 4. Support:
Taxpayer must provide more than half the support
How can the gross income for a qualifying relative test be satisfied? - (answer)Gross income
must be less than $4050 (Do not include tax exempt income)
What is the purpose of Form 2120 Multiple Support Declaration? - (answer)You only need 2120
multiple support declaration if you are claiming someone other than a qualifying child as a
