New information is constantly collected to determine the national cost of living standards. The national cost of living standards are set to try to include every area or region involved. Additionally,

A. The living standards vary according to region and possible according to culture.

B. The IRS tries to apply the national standards for food, clothing and other items so credits, deductions and special programs such as student aid, state welfare, and benefit programs can apply these standards to their programs. 

C. The national standards have been established for five necessary expenses which include food, housekeeping supplies, apparel and apparel services, personal care products and personal care service and other miscellaneous items. 

D. All of the above

You may also be responsible for gift taxes if you are a very generous individual. After all, why should the recipient of the gift be the only one who benefits? The Internal Revenue Service also wants part of that gift. The annual exclusion for gifts

A. Remains the same at $14,000 for tax year 2015.

B. Rises to $18,000 for tax year 2015.

C. Has been eliminated for tax year 2015. 

D. None of the above.

If you live abroad and earn money abroad, you may take advantage of the Foreign Earned Income Exclusion Credit. The foreign earned income exclusion rises to

A. $11,700 for tax year 2015.

B. $14,400  for tax year 2015.

C. $100,800 for tax year 2015.

D. $12,700 for tax year 2015.

The small employer health insurance credit provides that the maximum credit is phased out based on the employer’s number of

A. Full-time equivalent employees in excess of 10 and the employer’s average annual wages in excess of $25,800 for 2015.

B. Part-time employees in excess of 20 and the employer’s average annual wages in excess of $25,800 for 2015.

C. Employees in excess of 30 and the employer’s average annual wages in excess of $55,800 for 2015. 

D. None of the above

The limitation for itemized deductions to be claimed on tax year 2015 returns of individuals begins with incomes of

A. $259,250 or more. 

B. $309,900 or more. 

C. $258,250 or more. 

D. None of the above.

The limitation for itemized deductions to be claimed on tax year 2015 returns of married filing jointly individuals begins with incomes of

A. $258,250 or more. 

B. $308,975 or more. 

C. $309,900 or more. 

D. None of the above.

If you are into investments, then you may have to pay the Internal Revenue Service a Net Investment Income Tax for 2015. The investment tax income limits are based on the taxpayer’s filing status. The Net Investment Income tax applies to individuals, estates and trusts that have certain investment income above certain set amounts at a rate of

A. 5.9 percent 

B. 3.8 percent

C. 10 percent 

D. 25 percent

The exemption is subject to a phase-out that begins with adjusted gross incomes of

A. $250,000 

B. $258,250 

C. $289,000 

D. None of the above

The exemption for married filing jointly is subject to a phase-out at adjusted gross income of

A. $250,000 

B. $254,200 

C. $309,900 

D. None of the above

The Alternative Minimum Tax exemption amount for tax year 2015 is

A. $41,100 

B. $51,900 

C. $53,600 

D. $80,800

The married filing jointly Alternative Minimum Tax exemption amount for tax year 2015 is ______ for married couples filing jointly.

A. $83,400 

B. $52,800 

C. $80,800 

D. $92,100

The maximum Earned Income Credit amount is ________ for taxpayers filing jointly who have 3 or more qualifying children,

A. $6,044 

B. $6,242 

C. $5,300 

D. $3,950

Estates of decedents who die during 2015 have a basic exclusion amount of

A. $14,000 

B. $5,250,000 

C. $4,200,000 

D. $5,340,000

The annual dollar limit on employee contributions to employer-sponsored healthcare flexible spending arrangements (FSA)

A. Is $2,550 for tax year 2015. 

B. Remains unchanged at $3,500 for tax year 2015. 

C. Remains unchanged at $5,500 for tax year 2015. 

D. None of the above.

The small employer health insurance credit provides that the maximum credit is phased out based on the employer’s number of full-time equivalent employees in excess of 10 and the employer’s average annual wages in excess of

A. $24,400 for tax year 2015. 

B. $25,000 for tax year 2015. 

C. $13,900 for tax year 2015. 

D. None of the above.

For tax years beginning after December 31, 2012, a 0.9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation based on incomes of married filing jointly taxpayers that exceeds

A. $250,000 

B. $125,000 

C. $200,000 

D. None of the above.

For tax years beginning after December 31, 2012, a 0.9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation based on incomes of single taxpayers that exceeds

A. $250,000 

B. $125,000 

C. $200,000 

D. None of the above. 

For tax years beginning after December 31, 2012, a 0.9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation based on incomes of married filing separate taxpayers that exceeds

A. $250,000 

B. $125,000 

C. $200,000 

D. None of the above.

For tax years beginning after December 31, 2012, a 0.9% Additional Medicare Tax applies to Medicare wages, self-employment income, and railroad retirement (RRTA) compensation based on incomes of head of household taxpayers that exceeds

A. $250,000 

B. $125,000 

C. $200,000 

D. None of the above. 

All Medicare wages, railroad retirement (RRTA) compensation, and self-employment income currently subject to Medicare Tax are subject to Additional Medicare Tax

A. To account for their Additional Medicare Tax liability. 

B. If there is no employer match for Additional Medicare Tax. 

C. If paid in excess of the applicable threshold for the taxpayer’s filing status. 

D. None of the above. 

These are combined to determine if income exceeds the Additional Medicare Tax threshold

A. Medicare wages and self-employment income. 

B. Self-employment income and estimated tax payments. 

C. Railroad retirement (RRTA) compensation and Medicare wages. 

D. Any of the above.

There are no special rules for nonresident aliens and U.S. citizens living abroad for purposes of the additional Medicare tax provision. Medicare wages, railroad retirement (RRTA) compensation, and self-employment income earned by such individuals will

A. Will not be subject to Additional Medicare Tax, even if it is in excess of the applicable threshold for their filing status. 

B. Will also be subject to Additional Medicare Tax, if in excess of the applicable threshold for their filing status. 

C. Will be taxable where there is no employer match for Additional Medicare Tax. 

D. None of the above.

An employer is responsible for withholding the Additional Medicare Tax from wages or railroad retirement (RRTA) compensation it pays to an employee in excess of $200,000 in a calendar year

A. Regardless of filing status. 

B. Based on your filing status. 

C. Only if you let your employer know your filing status on Form W-4. 

D. None of the above. 

An employer is required to begin withholding Additional Medicare Tax in the pay period in which it pays wages or railroad retirement (RRTA) compensation in excess of $200,000 to an employee

A. And instruct the taxpayer to continue to make estimated payments. 

B. And stop withholding once compensation exceeds $150,000. 

C. And stop withholding once compensation reaches $200,000. 

D. And continue to withhold it each pay period until the end of the calendar year.

To account for their Additional Medicare Tax liability, some taxpayers may need to

A. Take into account their filing status. 

B. Pay taxes in excess of the applicable threshold for their filing status. 

C. Adjust their withholding or make estimated tax payments. 

D. None of the above.

The Net Investment Income Tax (NIIT) applies in the case of married filing separate individuals, at a rate of 3.8 percent on

A. The net investment income. 

B. The excess of modified adjusted gross income over $125,000 threshold amount. 

C. The lesser of A and B above. 

D. None of the above.

The Net Investment Income Tax (NIIT) applies in the case of married filing jointly individuals, at a rate of 3.8 percent on

A. The net investment income. 

B. The excess of modified adjusted gross income over $250,000 threshold amount. 

C. The lesser of A and B above. 

D. None of the above. 

The Net Investment Income Tax (NIIT) applies in the case of filing single individuals, at a rate of 3.8 percent on

A. The net investment income. 

B. The excess of modified adjusted gross income over $200,000 threshold amount. 

C. The lesser of A and B above. 

D. None of the above.

In the case of an estate or trust, the new tax of 3.8 percent applies on

A. The undistributed net investment income. 

B. The excess of the adjusted gross income over the dollar amount at which the highest tax bracket begins for an estate or trust for the tax year. 

C. The lesser of A or B above. 

D. None of the above.

In general, investment income, for purpose of this tax, includes

A. Interest, dividends, nonqualified annuities, royalties and rents that is derived in a trade or business in which the NIIT does not apply. 

B. Certain passive or trading income from a trade or business to which the net investment income tax does not apply. 

C. Net gains from the disposition of property other than property held in a trade or business in which the NIIT does not apply. 

D. None of the above.

The NIIT does not apply to certain types of income that are excluded for regular income tax purposes such as

A. Tax-exempt state or municipal bond interest. 

B. Veterans Administration benefits. 

C. Excluded gain from the sale of a principal residence. 

D. Any of the above.

The following is a true statement regarding same sex marriage for tax purposes.

A. For federal tax purposes, the IRS looks to state or foreign law to determine whether individuals are married.  

B. The IRS has a general rule recognizing a marriage of same-sex spouses that was validly entered into in a domestic or foreign jurisdiction whose laws authorize the marriage of two individuals of the same sex, if the married couple does not reside in the domestic or foreign jurisdiction that does not recognize the validity of the same-sex marriage. 

C. The IRS has a general rule recognizing a marriage of same-sex spouses that was validly entered into in a domestic or foreign jurisdiction whose laws authorize the marriage of two individuals of the same sex even if the married couple resides in a domestic or foreign jurisdiction that does not recognize the validity of same-sex marriages. 

D. None of the above.

For tax year 2013 and going forward, same-sex spouses generally must file using a married filing separately or jointly filing status. Additionally,

A. For tax year 2012 and all prior years, same-sex spouses who file an original tax return on or after Sept. 16, 2013, generally must file using a married filing separately or jointly filing status. 

B. For tax year 2012, same-sex spouses who filed their tax return before Sept. 16, 2013, are required to amend their federal tax returns to file using married filing separately or jointly filing status. 

C. For tax years 2011 and earlier, same-sex spouses who filed their tax returns timely are required to amend their federal tax returns to file using married filing separately or jointly filing status provided the period of limitations for amending the return has not expired.  

D. A taxpayer generally may file a claim for refund for ten years from the date the return was filed or 8 years from the date the tax was paid, whichever is later.

For federal tax purposes, the IRS has a general rule recognizing a marriage of same-sex individuals that

A. Was validly registered with the Internal Revenue Service in a timely manner by the end of your tax year. 

B. Was validly entered into in a domestic or foreign jurisdiction whose laws authorize the marriage of two individuals of the same sex. 

C. Generally, meet the MFJ or MFS rules and that have lived together as married couples do. 

D. All of the above.

If same-sex spouses (who file using the married filing separately status) have a child, which parent may claim the child as a dependent?

A. If both parents claim a dependency deduction for the child on their income tax returns, the IRS will treat the child as the qualifying child of the parent with whom the child resides for the longer period of time during the taxable year.  

B. If the child resides with each parent for the same amount of time during the taxable year, the IRS will treat the child as the qualifying child of the parent with the lower adjusted gross income and thus the more needy parent. 

C. If a child is a qualifying child under section 152(c) of both parents who are spouses (who file using the married filing separate status), both parents may claim a dependency deduction for the qualifying child. 

D. None of the above.

If a taxpayer adopts the child of his or her same-sex spouse as a second parent or co-parent, may the taxpayer (“adopting parent”) claim the adoption credit for the qualifying adoption expenses he or she pays or incurs to adopt the child?

A. An adopting parent of a same-sex marriage may not claim an adoption credit. 

B. A taxpayer may not claim an adoption credit for expenses incurred in adopting the child of the taxpayer’s spouse.  

C. A taxpayer of a same-sex marriage may claim an adoption credit for expenses incurred in adopting the child of the taxpayer's same-sex spouse. 

D. None of the above.

If an employer provided health coverage for an employee’s same-sex spouse and included the value of that coverage in the employee’s gross income, can the employee file an amended Form 1040 reflecting the employee’s status as a married individual to recover federal income tax paid on the value of the health coverage of the employee’s spouse?

A. Yes, for all years for which the period of limitations for filing a claim for refund is open. 

B. If an employer provided health coverage for an employee’s same-sex spouse, the employee may not claim a refund of income taxes paid on the value of coverage that would have been excluded from income had the employee’s spouse been recognized as the employee’s legal spouse for tax purposes. 

C. No, He does not need to obtain the written statement from its employee with respect to the 2013 overpayments. 

D. None of the above. 

The Small Business Health Care Tax credit helps small businesses and small tax-exempt organizations afford the cost of covering their employees, and is specifically targeted for those businesses with low and moderate income workers. Furthermore,

A. The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have. 

B. In general, the credit is available to small employers that pay at least half the cost of single coverage for their employees. 

C. To qualify for the credit for tax years beginning in 2014 and forward, a small employer must contribute toward premiums on behalf of each employee enrolled in a qualified health plan (QHP) offered by the employer through a Small Business Health Options Program (SHOP Exchange). 

D. Any of the above.

Tax-free treatment for employer-provided health care to an employee’s child has been extended until the end of the year in which the child turns

A. Age 17 

B. Age 19 

C. Age 24 

D. Age 26

The costs and reimbursements under employer health plans for coverage for an employee's eligible children are

A. Free of income taxes regardless of dependency tests. 

B. FICA and FUTA taxes regardless of dependency tests. 

C. Both A and B above. 

D. None of the above.

Employers with cafeteria plans (plans that allow employees to choose from a menu of at least one qualified benefit and a taxable benefit (such as cash)) can permit employees to pay for health coverage for children with pre-tax contributions and

A. This tax benefit also applies to self-employed individuals who qualify for the self-employed health insurance deduction. 

B. This tax benefit does not apply to self-employed individuals with self-employed health insurance. 

C. The costs and reimbursements under employer health plans for coverage for an employee's children are not tax free. 

D. None of the above.

The Affordable Care Act requires employers to report the cost of coverage under an employer-sponsored group health plan on an employee’s Form W-2 and

A. Reporting the cost of health care coverage on Form W-2 is beneficial to the employee as it allows for a greater tax benefit. 

B. The value of the employer's contribution to health coverage is included in income and thus it is taxable. 

C. Reporting the cost of health care coverage on Form W-2 is for informational purposes only. 

D. None of the above.

Starting in 2014, individuals and families who get their health insurance coverage through the Health Insurance Marketplace may be eligible for the

A. Additional Medicare Tax. 

B. Premium Tax Credit. 

C. Net Investment Income Tax. 

D. Any of the above.

In general, you may be eligible for the Premium Tax Credit if you

A. Buy health insurance through the Health Insurance Marketplace. 

B. You are ineligible for coverage through an employer or government plan and are within the income limits. 

C. Both A and B above. 

D. None of the above.

If you file your tax return using the filing status Single, Married Filing Jointly, Head of Household or Qualifying Widow/Widower, you may be eligible for the premium tax credit if you meet the other criteria. However,

A. If you are married and you file your tax return using the filing status Married Filing Separately, generally you will not be eligible for the premium tax credit. 

B. The Marketplace will estimate the amount of the premium tax credit and you will not be able to claim the credit on your tax return. 

C. You have to wait for the next enrollment period to get all of the credit. 

D. None of the above.

During enrollment through the Marketplace, using information you provide about your projected income and family composition for the year,

A. Your tax preparer will be able to estimate the amount of the premium tax credit you will be able to claim on your return. 

B. The Martketplace will estimate the amount of the premium tax credit you will be able to claim on your tax return. 

C. You will decide if you want the credit issued to you or to your insurance company. 

D. Any of the above.

For any tax year, if you receive advance Premium tax credit payments in any amount or if you plan to claim the premium tax credit,

A. You must file a federal income tax return for that year. 

B. The difference will decrease the amount you owe on your tax liability. 

C. You will receive the credit later. 

D. None of the above.

The individual shared responsibility provision requires you and each member of your family to

A. Have minimum essential coverage. 

B. Have an exemption from the responsibility to have minimum essential coverage. 

C. Make a share responsibility payment when you file your 2015 tax return in 2016. 

D. Any of the above.

If you and your family need to acquire minimum essential coverage, you can acquire

A. Health insurance coverage provided by your employer or health insurance purchased directly from an insurance company. 

B. Health insurance purchased through the Health Insurance Marketplace in the area where you live, where you may qualify for financial assistance. 

C. Coverage provided under a government-sponsored program for which you are eligible including Medicare, Medicaid, and health care programs for veterans. 

D. Any of the above.

For purposes of the individual shared responsibility payment, you are considered to have minimum essential coverage for the entire month as long as you have minimum essential coverage for

A. The entire month. 

B. The last day of the month. 

C. At least one day during the month. 

D. None of the above. 

You may be exempt from the requirement to maintain minimum essential coverage and thus will not have to make a shared responsibility payment when you file your 2015 federal income tax return in 2016, if you

A. Have no affordable coverage options because the minimum amount you must pay for the annual premiums is more than eight percent of your household income. 

B. Have a gap in coverage for less than three consecutive months. 

C. Qualify for an exemption for one of several other reasons, including having a hardship that prevents you from obtaining coverage, or belonging to a group explicitly exempt from the requirement. 

D. Any of the above.

Because of the Affordable Care Act, more Americans have access to coverage that is affordable. However, if there is no coverage available to you and your family that costs less than eight percent of your household income, you

A. Can qualify for an exemption. 

B. Will have to pay a penalty when you file your return in 2016. 

C. Get the minimum coverage before you can file your tax return in 2016. 

D. None of the above.

You can learn more at HealthCare.gov about which health insurance options are available to you, how to purchase health insurance coverage, and how to get financial assistance with the cost of insurance. Additionally,

A. An exemption applies to individuals who purchase their insurance through the Marketplace during the enrollment period for 2015, which from November 1, 2015, through January 31, 2016. 

B. You can qualify for a life changing even if you get married or are having a baby. 

C. You can qualify the Special Enrollment Period if you are adopting a child or placing a child for adoption or foster care.  

D. Any of the above.

How you get an exemption from the requirement to maintain minimum essential health insurance coverage depends upon the type of exemption for which you are eligible. You can obtain some exemptions

A. Only from the Martketplace. 

B. Only from the IRS. 

C. From either the Marketplace or the IRS. 

D. Any of the above.

The individual shared responsibility provision went into effect in 2014 and

A. You won’t need to report minimum essential coverage or exemptions or make any individual shared responsibility payment until you file your 2014 federal income tax return in 2015. 

B. You won’t need to report minimum essential coverage until the next enrollment period opens. 

C. You will not need to make an individual shared responsibility payment on your tax return if you don't have minimum coverage. 

D. Any of the above.

If you or any of your dependents don’t have minimum essential coverage and don’t have an exemption, you

A. Paying the additional shared responsibility payment will save you from paying for any medical care expenses. 

B. Paying the additional shared responsibility payment means that you will be protected from very high medical bills that would otherwise lead to bankruptcy. 

C. Will need to make an additional shared responsibility payment on your tax return. 

D. None of the above. 

If you must make an individual shared responsibility payment, the annual payment amount is the greater of a percentage of your household income or a flat dollar amount, but is capped at the national average premium for a bronze level health plan available through the Marketplace. You will owe

A. 1/12th of the annual payment for each month you or your dependents don't have coverage. 

B. A. 1/12th of the annual payment for each month you or your dependents don't have an exemption. 

C. Both A and B above. 

D. 1% of the annual payment for each month you or your dependents don't have the coverage. 

For 2015, the annual payment amount for not having essential health insurance coverage is

A. 1 percent of your household income that is above the tax return filing threshold for your filing status. 

B. Your family's flat dollar amount, which is $95 per adult and $47.50 per child for a maximum of $285. 

C. The greater of A or B above. 

D. None of the above. 

You can request an automatic extension of time to file a U.S. individual income tax return by

A. Electronically filing Form 4868. 

B. Paying all or part of your estimated income tax due using a credit or debit card or by using EFTPS. 

C. Filing a paper Form 4868 by mail. 

D. Any of the above.

If you cannot file by the due date of your return, then you can request an extension of time to file and

A. An extension of time to file will extend the time to pay. 

B. An extension of time to file will save you money on interest and late payment penalties. 

C. An extension of time to file is not an extension of time to pay. 

D. None of the above.

You must determine your filing status before you can determine your filing requirements,

A. And correct exemptions. 

B. And health insurance deduction. 

C. Standard deduction and correct tax. 

D. And itemized deductions.

If the total amount you paid is more than the amount others paid,

If you do not itemize deductions, you are entitled to a higher standard deduction if you are 65 or older at the end of the tax year. You are considered 65 on the day before your 65th birthday. Therefore, you can take a higher standard deduction for 2015 if you were born before

A. January 2, 1948 

B. January 2, 1951 

C. January 2, 1947 

D. January 2, 1950

Kevin's wife died January 20, 2013, and by the end of 2013 Kevin had not remarried. During 2014, and 2015 he had continued to keep up a home for himself and his child for whom he can claim an exemption.

A. He can file Married Filing Jointly in 2013. 

B. He can file Qualifying Widow(er) with Dependent child in 2014. 

C. He can file Qualifying Widow(er) with Dependent Child in 2015. 

D. All of the above.

If you could be claimed as a dependent by another person, you

If you have a child who was placed with you by an authorized placement agency, you may be able to claim an exemption for that child. However, if you cannot get a SSN or an ITIN for the child, you must

A. Not claim this child on your tax return because he or she does not qualify for any number. 

B. Get an adoption taxpayer identification number (ATIN) for the child from the IRS. 

C. Apply for an individual taxpayer identification number (ITIN). 

D. Apply for a special social security number for adoptees at the Social Security Administration office.

If you choose married filing separately as your filing status, the following is reduced at income levels that are half of those for a joint tax return.

A. The Child Tax Credit and the Retirement Savings Contribution Credit. 

B. The Credit for the Elderly or the Disabled. 

C. The Earned Income Credit. 

D. All of the above.

To qualify for Head of Household filing status, at the end of the year, you must be

A. Unmarried. 

B. Considered unmarried. 

C. Either A or B above. 

D. None of the above.

If you and your spouse file separately, and your spouse itemizes her deductions, you must

A. Itemize your deductions also. 

B. Use the standard deduction instead. 

C. Tell her that she cannot itemize because you are claiming the standard deduction. 

D. Split income between the two.

If you were married on or before December 31, 2015, what can your filing status be for tax year 2015?

A. Single 

B. Married Filing Jointly 

C. Married Filing Separately. 

D. Both B and C above.

You must provide over half of the cost of keeping up a home for ____________ to file as Head of Household.

      ___

If your child is considered temporarily absent from home, you can still claim him as living with you if he is away because of

A. Illness 

B. Education or business. 

C. Vacation or military service. 

D. Any of the above

You may be eligible to file as Head of Household even if the child who is your qualifying person has been kidnapped. You can claim Head of Household filing status if

A. The child is presumed by law enforcement authorities to have been kidnapped by someone who is not a member of your family or the child's family. 

B. In the year of the kidnapping, the child lived with you for more than half the part of the year before the kidnapping. 

C. You would have qualified for Head of Household filing status if the child had not been kidnapped. 

D. All of the above.

Marvyn is married to Clara and for 2015, due to some marital problems, they filed married filing separate. Clara will itemize her deductions of $11,000 because she had qualifying car expenses. Marvyn wants to use the standard deduction on his tax return, because his total itemized deductions amount is only $4,100 for 2015 and it is less than the standard deduction amount. Since Clara will itemize her deductions,

A. Marvyn has to use the standard deduction amount of $6,300. 

B. Marvyn also has to itemize his deductions and use the $4,100 amount. 

C. Marvyn can use $3,150 standard deduction amount. 

D. Marvyn should not file a tax return. 

For Head of Household filing purposes, if your father is your qualifying relative and he does not live with you,

If on the last day of your tax year you are living together in a common law marriage that is recognized in a state where you now live or in the state where the common law marriage began, for the whole year you are

A. Single 

B. Separated 

C. Considered married. 

D. Considered not married.

You must file an income tax return for a decedent if

A. You are the surviving spouse, executor, administrator, or legal representative. 

B. The decedent met the filing requirement to file a tax return at the time of his or her death. 

C. Both A and B above. 

D. The decedent had a will with a large inheritance to be distributed.

You may have to pay a penalty if you are required to file a tax return but fail to do so. If you willfully fail to file a tax return,

     ___

A person who is a dependent may still have to file a tax return. This depends on the amount of the dependent's

A. Earned income. 

B. Unearned income. 

C. Gross income. 

D. All of the above.

Age is a factor in determining if you must file a tax return

A. Only if you are 65 or older at the end of your tax year. 

B. Only if you are a dependent at the end of your tax year. 

C. Only if your gross income is more than $4,100 at the end of your tax year. 

D. If you are 65 or older, you are a dependent or you have gross income of more than $4,100 at the end of your tax year.

For purposes of determining whether you must file a tax return, you must include in your gross income

A. All of the income you earned or received abroad. 

B. Any income you can exclude under the foreign earned income exclusion. 

C. Both A and B above. 

D. Only income that you have not already reported with your state or foreign country.

Even if you are not required to file a tax return, you should consider filing

A. If you had income tax withheld from your pay. 

B. To keep you from getting a notice from the IRS. 

C. If box 3 of Form 1099-B (or substitute statement) is blank. 

D. Any of the above.

If you only owe household employment taxes, you

If more than one filing status applies to you, choose the one that will give you the lowest tax. If you obtained a divorce on December 26, 2015. At the time of your divorce in 2015 you intended to and did remarry each other on August of 2016. You and your spouse must file your tax return as

A. Married Filing Jointly. 

B. Married Filing Separate. 

C. Either A or B above. 

D. Single. 

If you actively participated in a passive rental real estate activity that produced a loss, you generally can deduct the loss from your nonpassive income up to a certain amount. This called a special allowance. Married persons filing separate tax returns who live together at any time during the tax year

A. Cannot claim this special allowance. 

B. Are each allowed a $12,500 maximum special allowance. 

C. Can deduct up to $25,000 special allowance. 

D. None of the above.

You can change your filing status by filing an amended tax return using Form 1040X. If you and your spouse file a joint tax return, you

A. Can change to a joint tax return any time within 3 years from the due date of the separate tax return or returns. 

B. Cannot choose to file separate tax returns for that year after the due date of the tax return. 

C. Can have your personal representative change from a joint tax return to a separate tax return. 

D. None of the above.

A personal representative for a decedent can change from a joint tax return elected by the surviving spouse to a separate tax return for the decedent. The personal representative has _______ from the due date (including extensions) of the tax return to make the change.

A. 6 months 

B. 3 years. 

C. 1 year. 

D. 2 years.

In qualifying for head of household filing status and in calculating the expenses of keeping up a home, include in the cost of upkeep expenses such as rent, mortgage interest, real estate taxes but do not include

A. Insurance on the home. 

B. The rental value of a home you own. 

C. Repairs and utilities. 

D. Food eaten in the home.

You can claim an exemption for a qualifying child or qualifying relative if you meet the

A. Dependent taxpayer test. 

B. Joint tax return test. 

C. Citizen or resident test. 

D. All of the above.

If you file a separate tax return, you can claim an exemption for your spouse,

A. Even though she can be claimed as a dependent by another taxpayer, the other taxpayer does not actually claim your spouse as a dependent. 

B. Only if your spouse had no gross income, is not filing a tax return and was not a dependent of another taxpayer. 

C. Only if your spouse had gross income and is filing a tax return. 

D. Only if your spouse is a nonresident alien with gross income from U.S. sources.

You generally cannot claim a married person as a dependent if he or she files a joint tax return, unless

A. He or she files only to claim a refund. 

B. He or she files only to pay a tax liability. 

C. He or she files only to claim for a refund and no tax liability would exist for either spouse on separate tax returns. 

D. He or she files a tax return to claim a credit such as the EIC.

You generally cannot claim a married person as a dependent if he or she files a joint tax return, unless

A. Taxes were taken out of their pay so they file a joint tax return only to get a refund of the withheld taxes. 

B. They file the tax return to get the earned income credit. 

C. Only as a claim for refund resulting from certain credits such as the American Opportunity Tax Credit. 

D. Only as a claim of refund and no tax liability would exist on a jointly filed tax return.

You will be able to claim various tax benefits if you have children. All of the following can be children which can qualify you for tax credits and deductions.

Although a child can be a qualifying child of more than one person, only one person can actually treat the child as a qualifying child to take

A. An exemption for the child and the Head of Household filing status. 

B. The Child Tax Credit and the Earned Income Credit. 

C. The Credit for Child and Dependent Care Expenses and the exclusion form income for dependent care benefits. 

D. All of the above.

To determine which person can treat the child as a qualifying child to claim certain tax benefits, the following statement is true regarding the tiebreaker rules.

A. If the parents do not file a joint return together they both claim the child as a qualifying child. 

B. If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of none. 

C. If only one of the persons is the child's parent, the child is treated as the qualifying child of the parent. 

D. If a parent can claim the child as a qualifying child but no parent does so claim the child, the child is treated as the qualifying child of the person who had the lowest AGI.

There are four tests that must be met for a person to be your qualifying relative. The following is not one of these tests.

A. Member of household or relationship test. 

B. Gross income test. 

C. The residency test. 

D. Not a qualifying child test.

Just like a qualifying child, a qualifying relative must

To be your qualifying child, a child who is not permanently and totally disabled must be

A. Younger than you. 

B. Younger than your spouse. 

C. Both A and B above. 

D. Younger than you or your spouse but not both of you.

The year you provide the support is the year you pay for it. If you pay for support with borrowed funds then

You have provided more than half of support in the following situation.

A. Your 17-year-old son, using personal funds, buys a car for $4,500. You provide all the rest of your son's support - $4,000. 

B. During the year, your son receives $2,200 from the government under the GI Bill. He uses this amount for his education. You provided the rest of his support - $2,000. 

C. You and your brother each provide 20% of your mother's support for the year. The remaining 60% of her support is provided equally by two people who are not related to her. 

D. None of the above.

You can claim an exemption under a multiple support agreement

The person who agrees to take the exemption under a multiple support agreement must

If the parents divorced or separated during the year and the child lived with both parents before the separation, the custodial parent is the one with whom the child lived with for the greater number of nights during the rest of the year. A child is treated as living with a parent for a night if the child sleeps

A. At a parent's home, with the parent present. 

B. At the parent's home, with the parent not present. 

C. In the company of the parent, when the child does not sleep at a parent's home. 

D. Any of the above.

Most taxpayers have a choice of either taking a standard deduction or itemizing their deductions. If you have a choice,

Thomas died May 6, 2015. Thomas was single and he would have turned 65 on December 20, 2015. What is his standard deduction amount for 2015?

A. $6,300 

B. $8,850 

C. $7,850

D. None of the above. 

If your itemized deductions are less than the amount of your standard deduction,

A. You can elect to itemize deductions on your federal tax return rather than take the standard deduction. 

B. You can itemize your deductions if the tax benefit of being able to itemize your deductions on your state tax return is greater than the tax benefit you lose on your federal tax return by not taking the standard deduction. 

C. You must itemize your deductions because your total deductions are more than the standard deduction amount. 

D. Both A and B above.

In some cases, your combined income tax on separate tax returns may be less that it would be on a joint tax return. The following is true if your filing status is married filing separately.

A. You should itemize deductions if your spouse itemizes deductions, because you cannot claim the standard deduction. 

B. You cannot exclude any interest income from qualified U.S. savings bonds that you used for higher education expenses. 

C. You may have to include in income more of any Social Security benefits you received during the year than you would on a joint tax return. 

D. All of the above.

Whether you must file a federal income tax return depends on

A. Your gross income. 

B. Your filing status. 

C. Your age and whether you are a dependent. 

D. Any of the above.

If you are required to file a tax return but you fail or willfully fail to do so

A. You may have to pay a penalty. 

B. You may be subject to criminal prosecution. 

C. Both A and B above. 

D. None of the above.

Gross income is all income your receive in the form of money, goods, property or services which is not exempt from tax. If you are married and lived with your spouse in a community property state,

A. Half of any income received may be considered yours. 

B. Only income you earned that is not transferred amongst the you and your spouse is yours. 

C. You must pay taxes on all the income your spouse earns. 

D. All of the above.

You must file a tax return if

A. You are a dependent. 

B. You owe any self-employment tax. 

C. You are single, under 65 and your income is $8,000. 

D. Any of the above.

Your filing status generally depends on

A. Whether you are single or married at any time during the year. 

B. Whether you are single or married at the end of the year. 

C. Whether you are going to use the standard deduction or if you are going to itemize. 

D. Any of the above.

Age is a factor in determining if you must file a return

A. If you are a dependent. 

B. If you are income falls under a certain amount. 

C. Only if you are 65 or older at the end of the tax year. 

D. If you are married and your spouse is not over 24 years old.

You must file an income tax return for a decedent if

A. You are the surviving spouse, executor, administrator, or legal representative. 

B. The decedent met the filing requirements at the time of death. 

C. Both A and B above. 

D. None of the above, a decedent is not required to file a return.

If you are single dependent who is blind or age 65 or older, you must file a return if

A. Your unearned income was more than $2,500. 

B. Your earned income was more than $7,600. 

C. Your gross income was the larger of $2,500 or your earned income plus $1,850. 

D. Any of the above.

If you are a married dependent, and you were either age over 65 or blind, you must file a return if

A. Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. 

B. Your unearned income was more than $1,000 or your earned income was more than $6,100. 

C. Your gross income was more than the larger of $1,000 or your earned income plus $350. 

D. None of the above.

If you are a married dependent, and you were either age over 65 or blind, you must file a return if

A. Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. 

B. Your unearned income was more than $2,200 or your earned income was more than $7,300. 

C. Your gross income was more than the larger of $2,200 or your earned income plus $1,550. 

D. Any of the above.

To determine whether you must file a return, include in your gross income

A. Any income you earned or received abroad. 

B. Any income you can exclude under the foreign earned income exclusion. 

C. Both A and B above. 

D. None of the above.

If you are a U.S. citizen and also a bona fide resident of Puerto Rico, you generally must file a U.S. income tax return

A. For any year in which you meet the income requirements. 

B. Your income does not include income from sources within Puerto Rico. 

C. Your income does not include income you received for your services as an employee of the United States or any U.S. agency. 

D. All of the above.

If you are a bona fide resident of Puerto Rico for the whole year, your U.S. gross income

A. Includes all income from sources within Puerto Rico. 

B. Includes income you received for your services as an employee of the United States or any U.S. agency. 

C. Does not include income from sources within Puerto Rico. 

D. A and B above.

A person who is a dependent may have to file a return depending on

A. His or her earned income. 

B. His or her unearned income. 

C. His or her gross income. 

D. Any of the above.

If a dependent child must file an income tax return but cannot sign the return,

A. The parent or guardian must sign the child's name followed by the words "By (your signature), parent for minor child". 

B. The parent or guardian must sign their name on the signature section of the return. 

C. The parent or guardian must include the income on their return and pay the tax on the income. 

D. None of the above.

Earned income for purposes of filing requirements and the standard deduction includes

A. Salaries, wages, professional fees. 

B. Amounts received as pay for work you actually perform. 

C. Any part of a scholarship that you must include in your gross income. 

D. All of the above.

If under local law the child's parent has the right to the earnings and actually receives the earnings,

A. The parent is liable to pay the tax. 

B. The amounts a child earns by performing services are included in the gross income of the parent. 

C. The child is not liable to pay the tax due on the this income. 

D. All of the above.

You may be able to include your child's interest and dividend income on your tax return if

A. The interest and dividend income was less than $10,000. 

B. Your child was under age 19. 

C. No federal income tax was withheld from your child's income under the backup withholding rules. 

D. Any of the above.

You may have to file a tax return even if your gross income is less than the required amounts if you

A. Are liable for the Alternative minimum tax. 

B. Have additional tax on a qualified plan such as an IRA. 

C. Have to pay household employment taxes and you are filing only because you owe these taxes. 

D. Only A and B above.

Even if you do not have to file a tax return, you should file a tax return if

A. You can get money back. 

B. You had income tax withheld from your pay. 

C. If you want to avoid getting a notice from the IRS. 

D. Any of the above.

You must determine your filing status before you can determine whether you must file a tax return, your standard deduction and your tax. You also use your filing status to determine

A. Whether you are eligible to claim certain deductions and credits. 

B. Your filing statuses. 

C. If you are considered married or unmarried. 

D. Any of the above.

You are considered unmarried for the entire year if

A. On the last day of your tax year, you are unmarried. 

B. On the last day of your tax year, you are legally separated under a divorce or separate maintenance decree. 

C. You are divorced under a final decree by the last day of the year. 

D. Any of the above.

If you obtain a divorce for the sole purpose of filing a tax return as unmarried individuals, and at the time of the divorce you intend to and and do, in fact, remarry each other in the next tax year,

A. You and your spouse can file a single individuals in previous year. 

B. You and your spouse must file as married individuals in both years. 

C. You and your spouse must file as married filing separate in both years. 

D. None of the above.

If you are considered married, you and your spouse must file as

A. Married Filing Jointly. 

B. Single. 

C. Head of Household. 

D. None of the above.

If you are married and can be considered unmarried for tax purposes, you and your spouse can file any of the following, except

A. Single. 

B. Married Filing Jointly. 

C. Married Filing Separate. 

D. Head of Household.

You are considered married for the whole year if, on the last day of your tax year, you and your spouse

A. Are married and living together. 

B. You are separated under an interlocutory decree of divorce. 

C. You are married and living apart but not legally separated under a decree of divorce or separate maintenance. 

D. Any of the above.

If your spouse died during the year, you are considered

A. Single for the rest of the year. 

B. Married for the whole year. 

C. Unmarried for the whole year. 

D. None of the above.

If your spouse died during the year and you remarried before the end of the year,

A. You can file a new return with your new spouse. 

B. Your deceased spouse's filing status is married filing separate for that year. 

C. A or B above. 

D. Can file as Qualifying Widow(er) with Qualifying child.

If you live apart from your spouse and meet certain tests, you may be able to file as head of household,

A. Only if you are divorced or legally separated. 

B. Even if you are not divorced or legally separated. 

C. Even if you lived with your spouse for the entire year. 

D. None of the above.

If your taxable income is more than $100,000 you can use form

A. 1040EZ 

B. 1040A 

C. 1040 

D. Any of the above.

On a joint return, you and your spouse report your combined income and deduct your combined allowable expenses. You can file a joint return

A. Only if both of you had income. 

B. Even if one of you had no income or deductions. 

C. Regardless if you or your spouse does not agree to file jointly. 

D. None of the above.

Filing jointly with your spouse allows you many benefits which includes

A. A lower tax than your combined tax for the other filing statuses. 

B. A higher standard deduction amount. 

C. Qualifying for tax benefits that do not apply to other filing statuses. 

D. All of the above.

If you and your spouse each have income, you may want to figure your tax both on a joint return and on a separate return and choose the one that

A. Gives you and your spouse the lower combined tax. 

B. Give you and your spouse the higher combined tax. 

C. Gives one of your the highest refund. 

D. None of the above.

If you are divorced under a final decree by the last day of the year, you are considered unmarried for the whole year and you

A. Cannot choose married filing jointly as your filing status. 

B. Cannot choose married filing separately as your filing status. 

C. Both A and B above. 

D. You must choose single as your filing status.

If you choose married filing separately as your filing status special rules apply such as

A. You can take a limited amount of the education credits (the American opportunity credit and lifetime learning credit), the deduction for student loan interest, or the tuition and fees deduction. 

B. The earned income credit amount will be limited. 

C. You cannot take the credit for child and dependent care expenses in most cases, and the amount you can exclude from income under an employer's dependent care assistance program is limited to $2,500. 

D. Any of the above.

If you choose married filing separately as your filing status, and you lived with your spouse at any time during the tax year,

A. You cannot claim the credit for the elderly or the disabled. 

B. You must include in income a greater percentage (up to 85%) of any social security or equivalent retirement benefits you receive. 

C. Both A and B above. 

D. None of the above.

The Taxpayer Identification Number (TIN) is an identification number used by the Internal Revenue Service (IRS) in the administration of tax laws. The following is this such number.

A. Social Security Number "SSN". 

B. Employer Identification Number. 

C. Individual Taxpayer identification Number "ITIN". 

D. Any of the above.

A TIN must be furnished on returns, statements, and other tax related documents. This number must be furnished

A. When filing your tax returns. 

B. When claiming treaty benefits. 

C. Either A or B above. 

D. None of the above.

You generally must list on your individual income tax return the social security number (SSN) of any person for whom you claim an exemption. If your dependent or spouse is not eligible to get a SSN, you

A. Must list the ITIN instead of the SSN. 

B. Must list the SSN instead of the ITIN. 

C. You must attach the copy of the birth certificate to the return. 

D. You must write "Applied for" in the appropriate line of your tax return.

You will need to complete Form SS-5, Application for a Social Security Card, and also submit

A. Evidence of your identity. 

B. Evidence of your age. 

C. Evidence of your citizenship or lawful alien status. 

D. All of the above.

This number is a tax processing number only available for certain nonresident and resident aliens, their spouses, and dependents who cannot get a Social Security Number (SSN) that begins with the number 9 in the SSN format.

A. A SSN 

B. An ITIN. 

C. An EIN 

D. All of the above.

To obtain an ITIN, you must

A. Complete Form W-7. 

B. Submit documentation substantiating foreign or alien status and true identity by mail. 

C. Submit documentation substantiating foreign or alien status and true identity by going through an Acceptance Agent authorized by the IRS. 

D. All of the above.

An ITIN, or Individual Taxpayer Identification Number is a 9-digit number, beginning with the number 9 and formatted like an SSN. Additionally,

A. You cannot claim the earned income credit using an ITIN. 

B. You can claim the earned income credit using an ITIN. 

C. You can use the ITIN even if you are eligible to obtain an SSN. 

D. Any of the above.

Foreign persons who are individual should apply for a social security number (SSN, if permitted) on Form SS-5 with the Social Security Administration or get an get an ITIN. Each ITIN applicant must now

A. Apply using the revised Form W-7. 

B. Attach a federal income tax return to the Form W-7. 

C. Both A and B above. 

D. None of the above.

This is a temporary nine-digit number issued by the IRS to individuals who are in the process of legally adopting a U.S. citizen or resident child but who cannot get an SSN for that child in to file their tax return.

A. An ITIN 

B. An ATIN 

C. An SSN 

D. Any of the above

You can receive income in the form of

A. Money 

B. Property 

C. Services 

D. Any of the above.

Generally, an amount included in your income is taxable unless it is

A. Specifically exempted by law. 

B. Tip income 

C. From self-employment. 

D. Any of the above.

You are generally taxed on income that is available to you, regardless of whether it is actually in your possession.

A. Bank deposit. 

B. Savings income. 

C. Constructively-received income. 

D. All of the above.

A valid check that you received or that was made available to you before the end of the tax year is considered income constructively received in that year,

A. As long as you cash the check or deposit it in that year. 

B. Even if you do not cash the check or deposit it to your account until the next year. 

C. As long as you do not cash the check or deposit it to your account until the next year. 

D. None of the above.

If the post office tries to deliver a check to you on the last day of the tax year but you are not at home to receive it, you must

A. Must include the amount in your income when you actually at home to receive it. 

B. Must include the amount in your income when you cash or deposit the check. 

C. Must include the amount in your income for that year. 

D. None of the above.

A valid check was mailed to you so that it could not possibly reach you until after the end of the tax year, and you could not otherwise get the funds before the end of the year,

A. You include the amount in your income for that year. 

B. You include the amount in your income for the next year. 

C. You include the amount when you actually deposit or cash the check. 

D. None of the above.

If you agree by contract that a third party is to receive income for you, you

A. Must include the amount in your income when the third party receives it. 

B. Must include the amount in your income when the third party makes it available to you. 

C. Must include the amount in your income when you actually deposit it into your account or when you cash it. 

D. None of the above.

You and your employer agree that part of your salary is to be paid directly to your former spouse.

A. You must only include the income if your former spouse gives it to you. 

B. You must include the income only if your employer pays it to you in your name. 

C. You must include that amount in your income when your former spouse receives it. 

D. None of the above.

Fringe benefits you receive in connection with the performance of your services are included in your income as compensation unless

A. You pay fair market value for them. 

B. They are specifically excluded by law. 

C. Either A or B above. 

D. You abstain from the performance of services such as under a covenant not to compete.

All of the following statements are true regarding recipients of fringe benefits, except

A. You are the recipient of a fringe benefit if you perform the services for which the fringe benefit is provided. 

B. You are considered to be the recipient of a fringe benefit even if it is given to another person. 

C. You have to be an employee of the provider in order to be a recipient of a fringe benefit. 

D. If you are a partner, director, or independent contractor, you can also be the recipient of a fringe benefit.

If you rent out personal property, such as equipment or vehicles, how you report your rental income and expenses is generally determined by

A. Whether or not the rental activity is a business. 

B. Whether or not the rental activity is conducted for profit. 

C. Both of the above. 

D. None of the above.