With regard to Schedule C, due diligence would require you to ask additional questions if:

Select one:

a. The client has no records to support the income claimed.

b. The client has no records to support the deductions claimed.

c. The numbers the client provides you are all round numbers.

d. The net income claimed by the client would allow him/her the maximum Earned Income Credit (EIC).

e. All of these

Lucas and Ana are married but Lucas moved out of their apartment in May 2020. They have no children and do not want to file a joint return. In June 2020, Anas mother, whose only income is $3,950 of social security, moved in withAna. Ana paid over half of her mothers support and all the cost of keeping up the home and can claim her as a dependent. Which filing status can Ana use?

a. Head of Household

b. Married filing separately

c. Single

d. None of these

Joyce is a widowed taxpayer whose husband Willard passed away on March 31, 2020. Joyce and Willard had purchased a home for $215,000 on September 12, 2004, lived in the home as their main home until Willards death. Joyce moved in with her daughter after Willards death, and sold the home on November 30, 2020, for $595,000. How much of the gain on the sale can Joyce exclude from taxable income?

a. $500,000, the maximum exclusion for an unmarried surviving spouse

b. $380,000, the amount of gain on the sale of the home.

c. $250,000, the maximum exclusion amount for a single taxpayer.

d. $0, because she moved out before she sold the home.