QUESTION 43:

Which of the following activities need to be reconciled when preparing a 2020 Form 1040? a) Interest received from Foreign banks. b Economic Impact Payments (EIP-1 and EIP-2). c) Alimony payments during the tax year. d) Unemployment benefits received during the pandemic.

Question 20

Julie visited Las Vegas before the Coronavirus pandemic and won $2,500 from the Nevada lottery on March 10th, 2020. She won an additional $250 on June 19th. Julie also spent a total of $1,800 on lottery tickets during that year.After Julie won the lottery, her friend, Agnes, gave her $135 in lottery tickets that she (Agnes) had purchased during the year. Note that Julie does not qualify to itemize deductions on her return.What amount of income must Julie report? and what form must she use to report gambling winnings?

a) $2,750/Schedule 1. b) $ 815/Form 1040. c) $ 950/Schedule 2. d) $ 0/Schedule 3.

Question 24

Tom, a new tax preparer, has heard of certain disaster relief payments that help individuals in lieu of the COVID-19 pandemic. Several of his clients have asked about one or more of these which they would like to claim/report for tax year 2020. In the following statements, employees dont have to include these payments in income, except for: a) Reimbursement for necessary personal, family, living, or funeral expenses incurred as a result of a qualified disaster. b) Reimbursement for necessary expenses incurred for the repair or rehabilitation of a personal residence. c) Amount paid by a federal, state or local government in connection with a qualified disaster in order to promote the general welfare. d) Unemployment benefits received during the COVID-19 pandemic.