Question
In terms of the tax formula for individual taxpayers, which of the following statements is correct? a. In arriving at AGI, a taxpayer must choose
- In terms of the tax formula for individual taxpayers, which of the following statements is correct?
| a. | In arriving at AGI, a taxpayer must choose between claiming deductions for AGI and deductions from AGI. | |
| b. | In arriving at taxable income, a taxpayer must choose between claiming deductions for AGI and deductions from AGI. | |
| c. | If a taxpayer has deductions for AGI, the standard deduction is not available. | |
| d. | In arriving at taxable income, a taxpayer must elect between deductions from AGI and the standard deduction. |
- Buddy and Hazel are ages 72 and 71, respectively, and file a joint return. In 2019 they have taxable retirement income of $100,000 and itemized deductions of $25,000. Their taxable income is
| a. | $100,000 | |
| b. | $76,000 | |
| c. | $75,000 | |
| d. | $73,000 |
- During 2019, Marvin had the following transactions:
Earned wages per W-2 $50,000
Bank loan $10,000
Alimony paid (divorce was finalized in 2019) $12,000
Net short term capital loss $4,000
Gift from aunt $2,000
Marvins AGI is:
| a. | $32,000. | |
| b. | $46,000. | |
| c. | $47,000. | |
| d. | $50,000. |
- Which of the following taxpayers may file as a head of household in 2019?
Marco provides all of the support for his mother, Sienna, who lives by herself in an apartment in Fort Lauderdale. Marco pays the rent and other expenses for the apartment and properly claims his mother as a dependent.
Tammy, age 24, provides over one-half the support for her 18-year old brother, Dan. He earned $4,200 in 2019 working at a fast-food restaurant and is saving all of his earnings to attend college in 2020. Dan lives in Tammys home.
Juans wife left him late in December of 2018. No legal action was taken and Juan has not heard from her in 2019. Juan supported his 6-year-old son, who lived with him throughout 2019.
| a. | Marco only | |
| b. | Tammy only | |
| c. | Juan only | |
| d. | Marco, Tammy, and Juan |
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Auditing And Assurance Services
Authors: Timothy Louwers, Penelope Bagley, Allen Blay, Jerry Strawser, Jay Thibodeau
9th International Edition
1266285997, 978-1266285998
