Question 1:

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 the return claiming the grandson as her qualifying child. What do you do?

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

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

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

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

Question 2:

Which statement is incorrect concerning alimony?

A) Alimony payments executed under orders after December 31, 2018, will no longer be taxable income for the recipient or deductible by the payer. (correct)

B)Taxpayers who make taxable alimony payments may be eligible to deduct these payments as an adjustment to income. (correct before 2018)

C) Alimony payments may not include child support. (correct)

D)To claim an adjustment for alimony paid, all that is necessary is the recipient's name and the amount of alimony paid.

Question 3:

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

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

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

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

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

Question 4:

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

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

b)Must make matching contributions to employee's contribution.

c)Must give employees a contribution adjustment.

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

Question 5:

Which of these is NOT among the most common reasons an e-filed tax return is rejected?

a)Use of an incorrect TIN on a tax return.

b)The preparer relied on nonstandard tax documents.

c)Mismatches between name and TIN. (True)

d)The same TIN on more than one return.