Question 32

Rita and Carl are both under the age of 65 and use the Married Filing Jointly filing status. Their AGI for tax year 2021 is $211,008.Their total Itemized Deductions are $24,708 (taxes and mortgage interest). How much could Copyright A & B Office, Income Tax School, 2021. All Rights Reserved. 8 Rita and Carl deduct on their tax return either using the Standard Deduction or by using Itemized Deductions? Choose the deduction type that has the most benefit. a) $24,708 b) $27,700 c) $25,100 d) $12,400

Question 39 The following statements are correct regarding pension and/or retirement distributions, except for (best option): a) RMD applies for IRAs (including SEPs and SIMPLE IRAs) on April 1 of the year following the calendar year in which the taxpayer reached age 70, if they were born before July 1, 1949. b) RMD applies on April 1 of the year following the calendar year in which the taxpayer reached age 72, if they were born after Jun 30, 1949. c) If the taxpayer receives a distribution (before age 59) from a traditional IRA, Roth IRA, or other qualified retirement plans, it is subject to an additional 10% penalty, exceptions apply. d) Taking a distribution in 2020 would require to pay more income tax. The taxpayer can take advantage of the 90- day period, which allows for RMDs to be rolled over into a new IRA.

Question 65 Rachel wants to prepare the last two years of tax returns. She then realized that she is allowed to list several types of tax expenses in order to itemize her deductions on her 2019 and 2020 tax returns.Which of the following types of expenses has a cap on deductibility for the 2019-2020 tax year (using Schedule A)? a) Charitable contributions. b) State and local property tax. c) Qualified Residence Loan. d) All the above.