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Exam 3: Computing the Tax

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Question 21

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During 2012, Esther had the following transactions: Esther's AGI is:

A) $62,000.
B) $64,000.
C) $67,000.
D) $102,000.
E) $104,000.

F) A) and D)
G) B) and E)

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Question 22

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Married taxpayers who file separately cannot later change to a joint return.

A) True
B) False

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Question 23

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Katrina, age 16, is claimed as a dependent by her parents.During 2012, she earned $5,600 as a checker at a grocery store.Her standard deduction is $5,900 ($5,600 earned income + $300).

Arnold is married to Sybil, who abandoned him in 2011.He has not seen or communicated with her since April of that year.He maintains a household in which their son, Evans, lives.Evans is age 25 and earns over $6,000 each year.For tax year 2012, Arnold's filing status is:

Currently, the top income tax rate in effect is not the highest it has ever been.

Perry is in the 33% tax bracket.During 2012, he had the following capital asset transactions: Perry's tax consequences from these gains are as follows:

In terms of income tax consequences, abandoned spouses are treated the same way as married persons filing separate returns.

Kyle, whose wife died in December 2009, filed a joint tax return for 2009.He did not remarry, but has continued to maintain his home in which his two dependent children live.What is Kyle's filing status as to 2012?

Kim, a resident of Oregon, supports his parents who are residents of Canada but citizens of Korea.Kim can claim his parents as dependents.

In 2012, Pierre had the following transactions: Pierre's AGI is:

Since an abandoned spouse is treated as single and has one or more dependent children, he or she qualifies for the standard deduction available to head of household.

Even if the individual does not spend funds that have been received from another source (e.g., interest on municipal bonds), the unexpended amounts are considered for purposes of the support test.

Ashley earns a salary of $55,000, has capital gains of $3,000, and interest income of $5,000 in 2012.Her husband died in 2011.Ashley has a dependent son, Tyrone, who is age 8.Her itemized deductions are $9,000.

In applying the gross income test in the case of dependents that are married, could the application of community property laws have any effect? Explain.

Jason and Peg are married and file a joint return.Both are over 65 years of age and Jason is blind.Their standard deduction for 2012 is $15,350 ($11,900 + $1,150 + $1,150 + $1,150).

A taxpayer who itemizes must use Form 1040, and cannot use Form 1040EZ or Form 1040A.

When separate income tax returns are filed by married taxpayers, one spouse cannot claim the other spouse as an exemption.

Regarding the Tax Tables applicable to the Federal income tax, which of the following statements is correct?

Monique is a resident of the U.S.and a citizen of France. If she files a U.S.income tax return, Monique can claim the standard deduction.

In determining whether the support test is met for dependency exemption purposes, only the taxable portion of a scholarship is considered.