Questions and Answers of Fundamentals Taxation 2020

Explain who qualifies for the deductibility of moving expenses in 2019.
In 2015, Chara incurred a loan to pay for qualified higher education expenses for her 20-year-old daughter who was a dependent. In 2019, her granddaughter graduated from college, moved away to start
The amount of savings bond interest exempt from tax is limited when an individual is single and his or her AGI reachesa. $121,600.b. $81,100.c. $79,550.d. $96,100.
In 2019, Joseph and Patricia Jefferson redeemed $8,000 of Series EE U.S. savings bonds (principal of $5,500 and interest of $2,500), the proceeds from which were used to pay for qualified higher
On July 1, 2019, Rene, a cash-basis taxpayer, purchased $500,000 of the newly issued bonds of Acce Corporation for $452,260. The 10-year bonds carry an interest rate of 8% and were sold to yield
Sean, who is single, received social security benefits of $8,000, dividend income of $13,000, and interest income of $2,000. Except as noted, those income items are reasonably consistent from year to
Carl and Karina file a joint return. Karina earned a salary of $38,000 and received dividends of $3,000, taxable interest income of $2,000, and nontaxable interest of $1,000. Carl received $9,000 of
Each of the following taxpayers received a state income tax refund in 2019. In all cases, the taxpayer has a filing status of married filing jointly. What amount of the refund is properly
Determine the amount of taxable income that should be reported by a cash-basis taxpayer in 2019 in each of the following independent cases:a. A taxpayer completes $500 of accounting services in
In 2014, Marie borrowed $10,000. In 2019, the debt was forgiven. Marie does not believe she should report the forgiveness of debt as income because she received nothing at the time the debt was
Items that must be reported on line 8 (other income) of Schedule 1 includea. Dividend income.b. Capital gains.c. Interest income. d. Jury duty pay.
Graciela, who is single, reported itemized deductions of $12,100 on her 2018 tax return. Her itemized deductions included $200 of state taxes paid. In 2019, she received a $150 refund of state taxes
Sam owns all of the stock in a newly formed corporation. During 2019, the first year of operation, the corporation realized current earnings and profits of $10,000. Sam received a $12,000
Charles and Joan Thompson file a joint return. In 2018, they had taxable income of $92,370 and paid tax of $12,202. Charles is an advertising executive and Joan is a college professor. During the
Paul has the following information:AGI for 2019 = $155,000Withholding for 2019 = $ 24,000Total tax for 2018 = $ 29,000Total tax for 2019 = $ 28,447a. How much must Paul pay in estimated taxes to
Victoria’s 2019 tax return was due on April 15, 2020, but she did not file it until June 12, 2020. Victoria did not file an extension. The tax due on the tax return when filed was $8,500. In 2019,
Using the appropriate tax tables or tax rate schedules, determine the tax liability for tax year 2019 in each of the following instances. In each case, assume the taxpayer can take only the standard
Determine the amount of the standard deduction for each of the following taxpayers for tax year 2019:a. Christina, who is single.b. Adrian and Carol, who are filing a joint return. Their son is
Raphael and Martina are engaged and are planning to travel to Las Vegas during the 2019 Christmas season and get married around the end of the year. In 2019, Raphael expects to earn $45,000 and
Donald is a 21-year-old full-time college student. During 2019, he earned $2,550 from a part-time job and $1,150 in interest income. If Donald is a dependent of his parents, what is his standard
What is the percentage of interest the IRS was charging on assessment (amount of unpaid tax liability) during March 2019? You might want to do this research by going to the IRS Web site
What is the amount of the tax liability for a married couple filing jointly with taxable income of $135,500?a. $29,810.b. $21,527.c. $18,200.d. $21,689.
Employers are required to withhold social security taxes from wages paid to employees. What is the amount of the social security wage limitation for
A married couple, both of whom are under 65 years old, decided to file as married filing separately. One of the spouses is going to itemize deductions instead of taking the standard
Which amount represents the standard deduction for a taxpayer who is 44 years old and claiming head of household status?a. $13,850.b. $18,000.c. $18,350.d. $12,200.
Esmeralda is 20 years of age and a full-time student living with her parents. She had wages of $500 ($50 of income tax withholding) for 2019. Can Esmeralda file a tax return to claim her $50 of
A taxpayer’s spouse died on December 31, 2018. He has no qualifying child. Which status should the taxpayer select when filing his 2019 tax return? a. Qualifying widow(er).b. Married
George and Debbie were legally married on December 31, 2019. Can they file their 2019 income tax return using the status of married filing jointly? Why or why not? What other filing status choices do
Xavier and his wife Maria have total W-2 income of $93,102. They will file their tax return married filing jointly. They had a total of $7,910 withheld from their paychecks for federal income tax
Sheniqua, a single taxpayer, had taxable income of $93,678. Her employer withheld $16,509 in federal income tax from her paychecks throughout the year. Using the tax tables, would Sheniqua receive a
The W-2 incomes of Betty and her husband Ronald were $43,688 and $41,539, respectively. If Betty and Ronald use a filing status of married filing jointly, determine their tax liability using the tax
The W-2 income of Sandra, a single taxpayer, was $88,793. Using the tax tables, determine Sandra’s tax liability.
Determine the tax liability, marginal tax rate, and average tax rate (rounded to two decimal places) in each of the following cases. Use the tax tables to determine tax liability.a. Married
Determine the tax liability, marginal tax rate, and average tax rate (rounded to two decimal places) in each of the following cases. Use the tax tables to determine tax liability.a. Married
Determine the tax liability, marginal tax rate, and average tax rate (rounded to two decimal places) in each of the following cases. Use the tax tables to determine tax liability.a. Single
Havel and Petra are married and will file a joint tax return. Havel has W-2 income of $45,588 and Petra has W-2 income of $47,229. What is their tax liability? Determine their tax liability using
Cameron is single and has taxable income of $88,806. Determine his tax liability using the Tax Tables and using the Tax Rate Schedule. Why is there a difference between the two amounts?
Arno and Bridgette are married and have combined W-2 income of $76,441. They received a $538 refund after they filed their taxes. How much income tax did their employers withhold during the
Eddie, a single taxpayer, has W-2 income of $36,741. Using the tax tables, he has determined that his tax liability is:a. $4,213.b. $4,019.c. $2,749.d. $2,555.
A married taxpayer has taxable income of $52,717. You have calculated tax liability using the tax tables and using the tax rate schedules. What can you say about the two figures?a. Tax
Sandra, a single taxpayer, has taxable income of $94,355. Using the tax tables, she has determined that her tax liability is:a. $16,825.b. $16,820.c. $12,480.d. $12,475.
Elizabeth determined that her tax liability was $3,492. Her employer withheld $3,942 from her paychecks during the year. Elizabeth’s tax return would show:a. A refund of $450.b. A refund
On a Form 1040, the amount of the permitted deduction from income for taxpayers filing a joint return is:a. $1,500.b. $12,200.c. $24,400.d. $36,600.
For tax year 2017 what proportion of individual income tax returns was electronically filed?

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