39) 39) In order to qualify to file as surviving spouse, all of the following criteria must be met by the widow or widower except A) he or she must be a U.S. citizen or resident. B) he or she and the decedent must have shared the same household as of date of death. C) he or she must be qualified to file a joint retum in the year of death. D) he or she must have at least one dependent child living at home the entire year and pay over half of the expenses of the home. 40) 40) Ben, age 67, and Karla, age 58, have two children who live with them and for whom they provide testal support. Their daughter is 21 years old, blind, is not a full-time student and has no income. Her twin brother is 21 years old, has good sight, is a full-time student and has income of $4,800. Which of the following statements is correct regarding Ben and Karla's ability to claim the twins as dependenty? A) The couple cannot claim either twin as a dependent. B) The couple can claim buth twins as dependents. o) The couple can only claim the daughter as a dependent. D) The couple can only claim the son as a dependent. 41) 41) Tom and Heidi, husband and wife, file separate retums. Tom and Heidi live in a cymmon law state. Tom's salary is $82,000 and Heidi's salary is $80,000. Heidi receives dividend income of $7,000 from stock inherited from her parents. Tom receives interest income of $5,000 from bonds purchased with his salary after marriage. Tom and Heidi receive $12,000 dividend income from stock they purchased jointly. Tom's income would be A) 596,500. B) 892,000 C) $93,000. D) $94,000. 42) 42) While using a metal detector at the beach during spring break, Toni uncovered some rare coins with a current fair market value of $9,000. What are her tax consequences regarding this find? A) She reports the entire FMV as income. B) Since she "found" the cuing, she does not have to report any amount of income until she sells the coins. Under the discovery rules in the tax law, she will never report any amount as taxable since the value is under $10,000. D) Because it was a "find" she only reports half of the FMV as income. 43) 43) Rebecca is the beneficiary of a $500,000 insurance policy on her husband's life. She elects to receive $52,000 per year for 10 years rather than receive the entire amount in a lump sum. Of the amount received each year A) $5,000 per year is tax free as a death benefit. B) $2,000 is taxable income. C) $52,000 is taxable income. D) $50,000 is taxable income. 44) 44) All of the following fringe benefits paid for by the employer may be excluded from an employee's gross income except A) subscriplions to prolessional publicalions. B) company-paid parking costing $225 per month to non-employees. discounts on services of 25 percent D) recreational facilities on employer's premises