a.

Karen, age 16, earned $3,000 as a counselor in camp and has $10,000 of interest and dividend income for 2021. Karen is a dependent of her parents. Karen will file her own tax return for 2021. In computing her tax liability for 2021, which statement is true?

	A.	Karen is subject to the kiddie tax because she has unearned income in excess of $2,200 for 2021.
	B.	Karen is not subject to the kiddie tax because she files her own tax return.
	C.	Karen will base her total tax liability on her parents marginal tax rate.
	D.	Karen is not subject to the kiddie tax because she has earned income.

b.

Which of the following is deductible to arrive at adjusted gross income?

		Unreimbursed dues paid to the AICPA by an employee of an accounting firm
		Hobby losses
		50% of the medical premiums paid by a self-employed individual
		50% of self-employment taxes