please I need your help

Question 1 of 70.

What happens if an education credit is received and later the school refunds part of the fees?

There is no tax consequence.

Part of the credit may have to be recaptured (paid back).

The credit will be reduced in future years.

Any additional education credits will be disallowed.

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Question 2 of 70.

Which of these would NOT be an exception to the early retirement distribution penalty?

A distribution due to death.

A 35-year-old taxpayer took a 401(k) distribution of $10,000 to pay qualified first-time homebuyer expenses.

An unemployed taxpayer withdrew money from her IRA to pay health insurance premiums.

An IRA distribution used to pay higher education costs.

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Question 3 of 70.

Jamie is a degree candidate at her local state college. She received a scholarship for $4,000 which covered half of her tuition costs. How much, if any, of the scholarship is taxable income?

$0

$1,000

$2,000

$4,000

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Question 4 of 70.

Makayla Searcy, a single mother, has three children, Sydney (7), Patrick (11), and Tiana (17). Makayla's AGI is $62,000, and her tax liability is $4,816. How much is Makayla's Child Tax Credit and Other Dependent Credit?

$3,000

$4,500

$6,000

Makayla is not eligible for the Child Tax Credit.

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Question 5 of 70.

Which of the following is a valid tiebreaker rule?

If neither claimant is a parent, the taxpayer who lived with the qualifying child longer will be allowed to claim the tax benefits.

The parent who provided more support for the qualifying child, regardless of residency and AGI, will be allowed to claim the tax benefits.

The parent with the higher AGI, regardless of residency, will be allowed to claim the tax benefits.

The parent who lived with the qualifying child longer, regardless of AGI, will be allowed to claim the tax benefits.

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Question 6 of 70.

Which of these is an exception to the penalty for early distribution of retirement funds?

The distribution was made from an IRA to pay qualified higher education expenses for the taxpayer's grandchild.

The distribution (up to $10,000 lifetime limit) was made from a 401(k) to pay qualified first-time homebuyer expenses.

The distribution was made from a qualified plan in a year (and to the extent that) an unemployed taxpayer paid health insurance premiums.

The distribution was made from an IRA to a taxpayer who separated from service during or after the year in which they reached age 55.

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Question 7 of 70.

Tax preparers should always document every question and answer:

Only for returns with EITC.

Any time they think the IRS might question something on the return.

Tax preparers are specifically required to document every question and answer on all EIC, CTC/ODC/ACTC, and AOTC claims and when using the head of household filing status. Also, anytime they think the IRS might question something on the return.

Only when they believe a taxpayer has lied to them.

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Question 8 of 70.

Which of these statements is TRUE concerning a partially taxable distribution of pension income?

Taxpayers are required to use the Simplified Method for any pensions with a starting date after July 1, 1986.

If box 2a of the Form 1099-R is blank, the pension is not taxable.

For a distribution for a pension with a staring date after November 18,1996, the Simplified Method should be used when box 2a of the Form 1099-R is blank and "taxable amount not determined" is checked.

For the Simplified Method, the age of the taxpayer is the age they turned during the year the pension began.

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Question 9 of 70.

Jasmine, age 48, contributed $5,000 to her traditional IRA. She is an active participant in a retirement plan at work. Her IRA MAGI is $76,000. What is her IRA adjustment to income?

$0

$5,000

$6,000

$7,000

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Question 10 of 70.

For Tax Year 2020, the maximum rate of tax on capital gain distributions is:

0%

15%

20%

37%

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Question 11 of 70.

Brian, a 48-year-old single taxpayer, earned $98,000 in wages. He is not covered by an employer-sponsored retirement plan. What is his maximum allowable contribution to a traditional IRA for 2020?

$0

$6,000

$7,000

$19,000

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Question 12 of 70.

Paul, James, Ryan, and Amy pay 80% of the support for their mother. Paul pays 40%, James and Ryan pay 15% each, and Amy pays 10%. Who is eligible to claim their mother as a dependent?

Since no one person pays over 50% of the support, none of the children may claim her as a dependent.

Since together they pay more than 50% of their mother's support, any one of them may claim their mother under a multiple support agreement.

Since together they pay more than 50% of their mother's support, Paul, James, or Ryan may claim their mother under a multiple support agreement.

Since together they pay more than 50% of their mother's support, they may share the dependency exemption based on the percentage each one pays.

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Question 13 of 70.

Lorenzo and Carlotta have three children (ages 5, 6, and 14). Lorenzo earned $36,000 in 2020. Carlotta worked part-time and earned $5,000. They had no other income. They paid a total of $4,600 in qualifying childcare expenses for their two youngest children ($2,300 for each child). The 14-year-old is Lorenzo's son from a prior marriage. He lives with Lorenzo's first wife, but Lorenzo will be claiming his son as a dependent this year. What is the correct amount of the federal Child and Dependent Care Expenses Credit?

$495

$945

$990

$1,012

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Question 14 of 70.

Rome (67) and Camille (69) are married and file a joint return. Their gross income (including one-half of their social security) for 2020 was $48,650. Choose the response that best completes this sentence: Up to ___ of their social security benefits may be taxable.

0%

50%

85%

100%

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Question 15 of 70.

Which of these is TRUE regarding the adoption credit?

The adoption credit is a refundable credit.

The maximum credit is $14,300 per return.

The maximum credit is $14,300 per child.

Employer assistance payments qualify for the credit.

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Question 16 of 70.

When may a noncustodial parent claim a child on their tax return?

When the noncustodial parent has the higher AGI.

Every other year.

When the custodial parent releases the exemption on Form 8332.

When they pay over 50% of the support for the child.

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Question 17 of 70.

Sheila is the daughter of your neighbor, Mary. She and her 6-year-old son moved in with Mary in August. Mary would like you to prepare a return claiming the grandson as her qualifying child. What do you do?

File the return since you know that Mary has done them a favor by allowing them to move in.

Explain the residency requirement and file the return showing the grandson lived with Mary for more than half the year.

File the return, but only after Mary assures you that Sheila will not be claiming her son.

Explain to Mary that she is not eligible to claim her grandson, and that you cannot knowingly file an incorrect tax return.

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Question 18 of 70.

How can you determine if a taxpayer's medical insurance premiums were paid by their employer?

They will receive a Form 1095-A from the employer.

They will receive a Form 1099-C from the employer.

There will be an entry coded "DD" in box 12 of the taxpayer's Form W-2.

The taxpayer will need to inform you if this is the case.

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Question 19 of 70.

Lloyd, a 50-year-old single taxpayer, earned $40,000 in wages. He is covered by an employer-sponsored retirement plan. What is his maximum allowable contribution to a traditional IRA for 2020?

$0

$6,000

$7,000

$19,000

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Question 20 of 70.

Review the following scenario, then choose the appropriate response describing steps a paid tax preparer must take to demonstrate due diligence. Charlie (21) comes in to your office to have his tax return prepared. He states that he is a full-time college student with income from a part-time job, and his parents will not claim him as a dependent. He wants to claim the American Opportunity Tax Credit (AOTC). Which of the following describes an appropriate question to ask or action to take?

Ask him if he has ever been convicted of a misdemeanor offense or had his driver's license revoked.

Inform him that he may be assessed a penalty of $540 if he fails to provide all the information required.

Inform him he must provide copies of all transcripts before you can prepare his return.

Request a copy of his Form 1098-T, Tuition Statement, and inquire into when and how his educational and other living expenses were paid.

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Question 21 of 70.

Jerry (52) and Diana (50) are married and lived with their qualifying relative, Rachel (25), for all of 2020. In October 2020, Rachel married Mike (27), and both lived with Jerry and Diana for the rest of the year. Rachel earned $2,400, and Mike earned $24,500 in 2020. Which of these is correct? Jerry and Diana may:

Claim Rachel, even if she chooses to file a joint return with Mike.

Claim Rachel if Mike chooses to file married filing separately.

Not claim Rachel because she is now Mike's dependent.

Claim Rachel for the nine months she was single, but not for the time after she was married.

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Question 22 of 70.

An employer who has a SIMPLE IRA retirement plan for employees:

Is required to make a nonelective contribution paid to all employees.

Must make matching contributions to employees' contributions.

Must give employees a contribution adjustment.

Receives a deduction on their business return for the contribution they made to their employees' accounts.

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Question 23 of 70.

Mario is a fireman for Your City. Which of the following types of retirement plans would he contribute to through his employer?

401(k)

403(b)

457

IRA

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Question 24 of 70.

Which of these is incorrect regarding child support payments?

Child support is not taxable income.

Child support is not included as an alimony payment adjustment.

Child support payments are not included when calculating the Earned Income Credit.

Alimony payments can never be treated as child support payments.

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Question 25 of 70.

In 2020, Elysia (38) contributed $2,000 to a traditional IRA. She is single, and her modified adjusted gross income (MAGI) is $30,000, all from wages. Elysia has never taken a distribution from any retirement account. She is potentially eligible for a retirement savings contributions credit (Saver's Credit) of up to ____________.

$0

$200

$400

$2,000

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Question 26 of 70.

Which of the following taxpayers may qualify for the Premium Tax Credit? They will each use the single filing status. They are U.S. citizens. Each purchased health care coverage through the Healthcare Marketplace, and each received Form 1095-A, Health Insurance Marketplace Statement.

Alanis. Her tax liability is zero.

Caleb. His household income places him at more than 400% of the federal poverty level in his state.

Jordan. He was eligible for employer-sponsored coverage, but he chose not to enroll in the plan because it would have cost him 5% of his household income.

Sydney. She will be claimed as a dependent on her grandmother's return.

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Question 27 of 70.

What determines when a dependent is considered to be 13 years old, if they are a qualifying child who had not reached their 13th birthday when the care was provided?

The day of their birthday.

The day before their birthday.

The last day of the year.

The first day of the following year.

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Question 28 of 70.

Joe (55) and Gail (49) are filing jointly for 2020. Joe earned $40,000, and Gail earned $2,500. Joe may contribute up to $7,000 to his IRA for 2020. If Joe contributes $5,000 to his IRA, how much may they contribute to Gail's IRA for 2020?

$2,000

$2,500

$6,000

$7,000

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Question 29 of 70.

When dependent care benefits are withheld from a taxpayer's income, where are they reported by the employer?

Form 2441.

Form 1040.

Box 10 of Form W-2.

The employer is not required to report them.

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Question 30 of 70.

Which of the following is NOT subject to federal tax?

Interest on U.S. Treasury bills, notes, and bonds.

Interest on a federal income tax refund.

Interest on New York state bonds.

Dividends paid by a credit union.

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