Advanced Certification Test Question
1. Bill can claim one personal exemption on his 2015 tax return. False
2. Bill has a filing requirement and must file a tax return. True
3. Julia can claim Piper as a dependent. True
4. Julia has no qualifying children for the earned income credit. False
5. If Beth does not qualify for a health coverage exemption, Julia must make a shared responsibility payment. True
6. Are George and Maria eligible to claim the earned income credit? No, because Maria has an ITIN.
INCORECT
7. Maria qualifies for a health coverage exemption. False
8. Which education credit is Chad eligible to take?
B. Lifetime learning credit
9. Which of the following are Chad’s qualified educational expenses for the lifetime learning credit? A. $1,095 in tuition
10. Matthew's Form 1095-A contains information that must be entered on Form 8965. False
INCORRECT
11. Matthew must repay a portion of the advance premium tax credit that he received. False
INCORRECT
12. What is the total amount of qualified educational expenses used in the calculation of Matthew’s American opportunity credit? $_8700___.
13. Where is the cancelled debt on Form 1099-C reported on Matthew's tax return? D. On Form 1040, line 21 as other income
14. Matthew qualifies for an exception to the 10% additional tax on the early distribution from his IRA. True
15. Is Head of Household the most advantageous allowable filing status Kelly can use? Yes
16. Kelly can claim Brian as a qualifying child for the earned income credit.
Yes
INCORRECT
17. What is Kelly's total federal income tax withholding?
2560
18. What is the credit for child and dependent care expenses on Form 2441, line 11?
a. $0
b. $520
c. $546
XXX d. $572
19.Kelly and her children did not have Minimum Essential Coverage (MEC) for two months of the tax year.How does this affect her tax return?
a. She must make an Individual Shared Responsibility Payment for herself.
b. She must make an Individual Shared Responsibility Payment for Mia and Logan.
XXX c. She must complete Form 8965 to claim the short coverage gap exemption.
d. None of the above.
20.What is the amount of additional tax on IRAs, other qualified retirement plans, etc., from the Other Taxes section of Kelly’s Form 1040, page 2? $__210_____.
21.What is the total taxable interest income shown on Line 8a of Form 1040?
a. $70
XXX b. $95
c. $150
d. $245
22.How does the code Q on Elliot’s Form 1099-R from Essex Bank affect the return?
a. The entire $4,500 distribution is taxable.
b. Half of the $4,500 distribution is taxable.
c. There is a 10% additional tax on the distribution.
XXX d. The entire $4,500 distribution is not taxable.
23. What is the amount shown on Form 1040, Line 13 – Capital gain or loss?
a. A gain of $516
XXX b. A gain of $1,239
c. A gain of $1,614
d. A gain of $1,689
24.How much of the $17,500 gross distribution reported on Form 1099-R is taxable in 2015? $ _16905_______.
25. Is Elliot’s Social Security income taxable?
a. No, because their total income is less than $32,000.
b. No, Social Security benefits are never taxable.
XXXc. Yes, a portion of the Social Security income is taxable.
d. Yes, all of the Social Security income is taxable.
26.Is there a shared responsibility payment on the Blackburns’ Form 1040, page 2?
XXXa. Yes
b. No
INCORRECT
27. Are the Blackburns entitled to claim an earned income credit for 2015?
a. No, because their investment income exceeds the amount allowed to claim the credit.
XXX b. No, Elliot is over the age of 65.
c. No, Carter is not a qualifying child for purposes of the EIC.
d. Yes, they are eligible for the credit.
28.Where should Enrique’s cash income be reported on the tax return?
a. Form 1040, Line 7
XXXb. Schedule C-EZ or C
c. Form 1040, Line 21
d. Cash income does not have to be reported
29.What is Enrique’s mileage expense deduction (at the standard mileage rate) for his business as a personal trainer?
a. $690
XXX b. $1,581
c. $3,738
d. $4,428
30.Which item cannot be deducted by Enrique as a business expense?
XXX a. Nutritional supplements
b. Business liability insurance
c. Advertising
d. Business license
31.How does Enrique’s self-employment tax affect his tax return?
a. Enrique’s self-employment tax is not reported anywhere on Form 1040.
b. A portion of the self-employment tax is deducted as a business expense on Schedule C-EZ or C.
c. The self-employment tax is shown on Form 1040, Other Taxes section, and the full amount is deducted on Schedule A, Taxes You Paid section.
XXX d. The self-employment tax is shown on Form 1040, Other Taxes section, and the deductible part is an adjustment on Form 1040, page 1.
32.What is the amount Enrique can take as a student loan interest deduction?
a. $0
b. $1,373
XXXc. $2,500
d. $2,745
33.What are Enrique’s total itemized deductions on Schedule A, line 29?
a. $6,706
b. $6,952
XXX c. $7,906
d. $8,286
34.The amount of Enrique’s retirement savings contributions credit in the Tax and Credits section of Form 1040 is $120.
XXX a. True
b. False
35.Enrique is not able to pay the entire balance due by April 15.What are his options?
a. He can submit a Form 9465, Installment Agreement Request.
b. He can contact the IRS for a full pay 120-day agreement.
c. He can pay using his credit card.
XXX d. Any of the above.