Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

07. Tony is a new tax preparer. He is attempting to understand the concept of constructive receipt of interest income. His new tax client has

image text in transcribed

07. Tony is a new tax preparer. He is attempting to understand the concept of constructive receipt of interest income. His new tax client has received the following types of interest income: Dividends from the credit union (credited on Jan. 1, 2018) Interest from National Bank (credited on Dec 31, 2017) Interest for the 2nd year of a 5-year Certificate of Deposit (credited on Dec 31, 2017, penalty for early withdrawal) Gift for opening account received in June Municipal bond interest (paid on Dec. 31, 2018) Series EE savings bond interest (defer to maturity) Interest on a money market fund (credited on Dec. 31, 2017) $ 974 $ 875 $ 658 $ 169 $ 205 $ 547 $ 245 What amount of taxable interest income should Tony's client report for the tax year? a) $1,702 b) $2,249 $1,533 c) $3,673 d) In 2017, Josephine found an error in her 2015 return. She amended her return and found that the IRS owed her an additional refund. She received her refund with interest on September 30, 2017. In what tax year should Josephine report the interest income? 68. a) 2015 b) 2016 c) 2017 d) Not taxable Don is a single parent. His son is 19 (not a student), and his daughter is 17 (still a student). 69. Don claimed EIC on his tax return for both children. He later received a letter from the Internal Revenue Service which disallowed EIC for his son. The letter also stated that Don's claim was an error due to reckless or intentional disregard of the EIC rules. For how many years will Don be denied EIC? 10 years 5 years b) c) 2 years 1 year d) . Last year Rick fraudulently claimed his cousin's children as dependents on his return to receive

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing And Assurance Services

Authors: Robert Ramsay, Timothy J Louwers

4th Edition

007739657X, 978-0077396572

More Books

Students also viewed these Accounting questions

Question

2. Do you agree that unions stifle creativity? Why or why not?

Answered: 1 week ago