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Julian is a single father with a son, Alex, who is 8 years old. If Julian’s AGI is $89,200, what is his child tax credit for Alex?
 
$0.
$250.
Correct
$750.
$1,000.
 
89200 - 75000 / 1000 = 14.2 (rounded to 15)
1000 - 15 x 50 = 750
   
Jerry and Ellen are married filing jointly with AGI of $45,000. They made a $1,570 contribution to a qualified retirement plan.
How much is their retirement savings contributions credit? Use Table 9-2.
 
$0.
$157.
$314.
$785.
 
1570 x 10% (.10)
   
Allie and Buddy are married, file a joint return, and have one son, Zack, age 5. Buddy has earned income of $42,150,
and Allie was a full-time student for eight months (with no income). They paid a qualified child care center $3,510.
How much is Allie and Buddy’s child and dependent care credit for the year?
Use Child and Dependent Care Credit AGI schedule.
 
$0.
$420
$645.
$740.
   
Jamison is a single dad with two dependent children, Zoey, age 7, and Conner, age 3. He has an
AGI of $72,250 and paid $4,560
to a qualified day care center for the two children. What amount can Jamison receive for the child and dependent care credit?
Use Child and Dependent Care Credit AGI schedule.
 
$4,560.
$1,596.
$912
$456.
   
After two and one-half years of working with the orphanage and the government, Jake and Nikki adopted a two-year-old girl from Korea.
The adoption process, which became final in January 2017, incurred the following qualified adoption expenses.
How much and in which year can Jake and Nikki take the adoption credit?
(Assume no limitation of the credit due to AGI.)
                 
                 Year 2016           $7,500
  Year 2017          $2,000
 
 
$7,500 in 2016.
$2,000 in 2017.
$9,500 in 2016.
$9,500 in 2017
   
Nathan paid $3,130 in qualifying expenses for his daughter who attended a community college.
How much is Nathan’s lifetime learning credit without regard to AGI limitations or other credits?
 
$288.
$626
$939.
$1,565.
 
3130 x .2
   
Justin and Janet, whose AGI is $165,500, have twin boys, Jake and Jaime, age 5. How much child tax credit can they take?
 
$0
$1,475.
$2,000.
$2,800.
   
Abel and Loni adopted a boy (a U.S. citizen), during the current tax year and incurred a total of $14,750 in qualified adoption expenses.
Abel and Loni have modified AGI of $225,250. What is the amount of adoption credit they can take?
 
 
$6,205
$7,195.
$13,570.
$14,750.
 
243540 - 225250 / 40000 x 135570
   
DJ and Gwen paid $3,720 in qualifying expenses for their son, Nikko, who is a freshman attending the University of Colorado. DJ and Gwen have AGI of $170,000
and file a joint return. What is their allowable American opportunity tax credit (AOTC) after the credit phaseout based on AGI is taken into account?
 
$0.
$1,215
$2,430.
$3,720.
   
Jim, a married filing jointly taxpayer, paid $5,000 of qualified tuition and related expenses for each of his twin daughters,
Stephanie and Amanda, during 2020. They started their freshman year of college during 2020. Jim was very excited that
both daughters excelled in the college environment; especially since Stephanie had a drug addiction during her senior
year of high school (Jim had a friend on the college admissions board that thankfully overlooked Stephanie's felony
drug conviction). Jim also paid $2,000 of qualified tuition and related expenses for his daughter Linda's sophomore
year of college and $3,000 for his own master's program. Jim claims all three of his daughters as dependents.
His modified gross income for the year is $50,000. What is the available Lifetime Learning Credit assuming he
elects to use the Lifetime Learning Credit for those expenses that do not qualify for the American Opportunity Tax Credit?
 
$1,600
 
($5,000 + $3,000) x 20%
   
Sara, who is single, contributed $6,000 to her Roth IRA for 2020. She had MAGI of $17,000 for 2020 and used the single filing status.
She has never taken a distribution from a retirement plan.
What is her maximum retirement savings credit for 2020?
 
$1,000
 
Her maximum credit for 2020 is $1,000 ($2,000 x 50%).
   
In 2020, Ginger paid $5,000 for qualified solar electric property and $4,000 for qualified fuel cell property with one kilowatt of capacity for her
vacation home. She also paid $10,000 for qualified solar water heating property for her personal residence.
What is her maximum residential energy efficient property credit for 2020?
 
$3,900
 
($5,000 x 26%) + ($10,000 x 0.26%)
   
Jim, a married filing jointly taxpayer, paid $10,000 of qualified tuition and related expenses for each of his twin daughters, Stephanie and Amanda, during 2020.
They started their freshman year of college during 2020. Jim was very excited that both daughters excelled in the college environment;
especially since Stephanie had a drug addiction during her senior year of high school (Jim had a friend on the college admissions board that thankfully
overlooked Stephanie's felony drug conviction). Jim also paid $2,000 of qualified tuition and related expenses for his daughter Linda's sophomore year
of college, and $3,000 for his own master's degree program. Jim claims all three of his daughters as dependents. His modified gross income for the year is $50,000.
What is the available American Opportunity Tax Credit for 2020?
 
$4,500
 
The credit available for Linda is $2,000 ($2,000 x 100%).
Linda would have needed $4,000 of expenses to get the maximum credit.
The total of credits for Amanda and Linda is $4,500 for 2020.
   
Which of the following statements concerning refundable tax credits is correct?
 
Refundable tax credits can generate a tax refund.
   
Which of the following statements concerning the general business credit is correct?
 
The general business credit is a combination of more than 30 different nonrefundable tax credits.
   
Brandy is a single mom with 2 children, Zach and Wendy. Zach is 14 years old and Wendy is 3 years old.
Brandy has AGI of $50,000. She paid the following expenses for child-care this year:
 
$300 to Zach to care for Wendy so Brandy could go out to dinner with friends.
$1,000 for an after-school program for Zach.
$3,500 to Brandy's mother for the care of Wendy during the day.
 
What is Brandy's available child and dependent care credit?
 
$600
 
Since Brandy has AGI over $43,000 she is able to take a credit of 20% x $3,000 = $600.
   
Kathryn earns a salary of $150,000 from Hospitals, Inc. as a hospital administrator during 2020. Hospitals, Inc.
withholds OASDI taxes in the amount of $8,537. She also earns $20,000 of wages from CPR Experts where she teaches CPR.
CPR Experts withholds OASDI taxes in the amount of $1,240. What is Kathryn's available credit for excess Social Security taxes withheld,
assuming Kathryn's tax due before application of the credit is $800?
 
$1,240
 
Kathryn will be allowed to take a $1,240 refundable credit against income taxes for the excess Social Security
taxes withheld from her compensation during the year. She is only required to pay Social Security tax on the
first $137,700 (2020) which was withheld from Hospitals, Inc. The amount withheld from CPR Experts is the excess amount.
   
Andy's second wife, Gina, died several years ago. Andy and Gina had two children together, Sara and Ben (twins, age 6) and they had adopted a
child Andrew (age 10). Andy also had a child, Angela, age 18, with his first wife. Andy's fiancé (who also lives with Andy) gave birth to Andy's
biological child, Sue Ellen, in November of the current year. All five children live with Andy and he claims all of them as dependents. Andy's AGI
for the current year is $60,000 and he files head of household. What is Andy's available child tax credit?
 
$8,000
 
He is entitled to $2,000 credit for four of the five children.
   
Which of the following statements concerning business credits is correct?
 
The amount of the rehabilitation credit is 20 percent of the qualified rehabilitation expenditures for certified historic structures.
   
Steve and Kendra have been unable to have a baby. They decided last year that adoption would the best choice for them.
They believe that they can support a child that has special needs both financially and emotionally. Therefore, they adopted, Janice,
a four year old child with special needs this year. They paid $8,000 in qualifying adoption expense for the current year.
Their MAGI for the year is $160,000 and their tax due before the application of the qualified adoption credit is $10,000.
What amount can Steve and Kendra's claim as an adoption credit for 2020?
 
$14,300.
   
Which of the following statements concerning the earned income credit is correct?
 
If the taxpayer has a qualifying child, the child must meet a relationship, age, and residency test.
   
Which of the following is a refundable credit?
 
Earned Income Credit
   
Which of the following statements concerning the Credit for the Elderly or Disabled is correct?
 
The credit is available to U.S. citizens and residents who qualify.