Vita Review Practice Study Guide Test.

VITA REVIEW PRACTICE STUDY GUIDE TEST. What is the most beneficial filing status allowable for Rebecca? a. Single b. Married filing jointly c. Head of Household d. Qualifying Widow(er) - CORRECT ANSWER Qualifying Widow(er) T or F: Rebecca has $3,100 in qualifying child care expenses for the child and dependent care credit - CORRECT ANSWER False Pat and Terry are eligible for which of the following credits? Select the best answer a. Credit for other dependents b. Child tax credit c. Earned income credit d. Both a and b - CORRECT ANSWER Both a and b - Credit for other dependents - Child tax credit T or F: Pat's unemployment compensation is not taxable this year because it was received as a result of the coronavirus pandemic. - CORRECT ANSWER False Which of the following statements is true? a. Janice's Medicaid waiver payments must be included in taxable income in order to be considered earned income when calculating the earned income credit. b. Janice's Medicaid waiver payments can never be considered earned income when calculating the earned income credit. c. Janice's Medicare waiver payments are not included in taxable income and are never considered earned income when calculating the earned income credit. d. Janice's Medicaid waiver payments are not included in taxable income but can be considered earned income for calculating the earned income credit. - CORRECT ANSWER d. Janice's Medicaid waiver payments are not included in taxable income but can be considered earned income for calculating the earned income credit. What is the amount of Andrew's HSA deduction on Form 8889, Part I, line 13? a. $1,500 b. $2,000 c. $2,500 d. $3,455 - CORRECT ANSWER $2,500 T or F: Andrew can identify the employer's HSA contribution by the Code W in Box 12 on his Form W-2. - CORRECT ANSWER True What is the total unreimbursed qualified medical expenses reported on Form 8889,Part II? a. $2,025 b. $2,153 c. $2,321 d. $2,400 - CORRECT ANSWER $2,400 Which individuals can make an agreement on who can claim Molly as a dependent? a. Barbara and Jenny b. Barbara and Claire c. Jenny and Claire d. Barbara, Jenny, and Claire - CORRECT ANSWER Barbara and Jenny Who can claim the earned income credit for Molly? a. Claire, because she has the lower AGI b. Jenny, because she is Molly's mother c. Barbara, if Jenny allows her to claim Molly as a dependent d. None of the above - CORRECT ANSWER Barbara, if Jenny allows her to claim Molly as a dependent If Robert chooses to itemize, which of the following is he eligible to claim as a deduction on Schedule A? a. $700 GoFundMe donation b. $3,500 Gambling losses c. $120 Homeowner's Association fees d. $260 Mortgage Insurance Premiums (PMI) - CORRECT ANSWER $260 Mortgage Insurance Premiums (PMI) If Robert chooses not to itemize, what is the amount that he can deduct as an above-the-line charitable contribution adjustment in 2020? a. $250 b. $300 c. $350 d. $1,050 - CORRECT ANSWER $250 What is the amount of Carly's student loan interest deduction on Form 1040,Schedule 1? $________. - CORRECT ANSWER 2500 How do educator expenses affect Carly's tax return? a. Carly can claim these expenses as a miscellaneous itemized deduction on her Schedule A b. These expenses cannot be claimed on her 2020 tax return because she does not meet the requirements to claim the educator expenses. c. $250 is deducted as an adjustment to income on Form 1040, Schedule 1. d. Carly is entitled to deduct the full $375 as an adjustment to income on Form 1040, Schedule 1. - CORRECT ANSWER b. These expenses cannot be claimed on her 2020 tax return because she does not meet the requirements to claim the educator expenses.