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Taxation Problem: Pam and Ted are married and want to file a joint return. Pam is a U.S. citizen and has a valid Social Security

Taxation Problem:

  • Pam and Ted are married and want to file a joint return.
  • Pam is a U.S. citizen and has a valid Social Security number. Terri is a resident alien and has an ITIN.
  • Pam has a child from a previous marriage, Jacob, age 17.
  • Pam and Ted have a child together, Jill, age 12
  • Jacob and Jill are U.S. citizens and have valid Social Security numbers.
  • Pam received a total of $3,300 in unemployment compensation when he lost his job due to the coronavirus pandemic. He also earned $22,000 in wages.
  • Terri did not have any income.
  • Pam and Ted provided all the support for their two children.

1. Pam and Ted are eligible for which of the following credits? Select the best answer.

a. Credit for other dependent

b. Child Tax Credit

c. Earned income credit

d. Both a and b

2. Pams unemployment compensation is not taxable this year because it was received as a result of the coronavirus pandemic.

True

False

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