21. Caroline and David file married filing jointly. Caroline receives compensation from her employer, who deducts federal withholding taxes and remits that money to the IRS. David is self-employed and made only one quarterly deposit of his federal taxes this year. At the time of filing, the couple owed an unpaid tax liability equal to two-thirds of what David should have remitted to the IRS. What does this mean for the couple?

1. Caroline and David owe the remaining tax liability jointly, and the IRS may require either, or both, to pay it.
2. If Caroline is unwilling to pay the tax liability based on David's earnings, she automatically qualifies for innocent spouse relief.

A)

II only

B)

Neither I nor II

C)

Both I and II

D)

I only

22. Which of the following are characteristics of a valid and enforceable premarital agreement?

1. It may be orally executed by the parties that are affected.
2. There should be a full and complete disclosure of each party's net worth prior to signing.
3. It may be used to regulate an award of alimony upon divorce of the parties.
4. There should be a written agreement with the willingly executed signatures of both parties.

A)

II and III

B)

II and IV

C)

I and II

D)

III and IV

23. Max and his mother, Lucy, live together in his home. Lucy is bedridden, and Max must pay a caregiver to provide meals and other aid during the day so he can leave the house and work. He pays $5,000 annually for this service. Max's mother has no income, and he is her full support. What tax relief may be available to Max for the expenses of caring for his elderly mother?

1. A greater standard deduction amount
2. Child and dependent care credit

A)

II only

B)

Both I and II

C)

Neither I nor II

D)

I only

24. Ayuma and Sakura reside in a common law property state and recently became engaged. Ayuma is a retired sports executive with a considerable fortune and has a son from a previous marriage. Sakura has never been married. Ayuma has presented Sakura with a five-carat diamond ring, contingent upon her signing of a premarital agreement. The federal income tax consequences of the premarital agreement depend in large part upon which of the following?

1. The original owner of the ring
2. Whether the transfer under the agreement is treated as a gift
3. Local and state law
4. Whether the transfer under the agreement is treated as a transfer for consideration

A)

III and IV

B)

I and II

C)

II and III

D)

II and IV