1) On her 2013 tax return, can or cannot Amy take a dependent child exemption for the following individuals? Why or why not? Assume the other requirements for the dependent child exemption has been met
Amy’s 10 year old grandson, David, has lived with her since October 1, 2013.
In 2013, Amy’s 20 year old son, Daniel was away at college for 8 months, travelled around Europe for 4 months, and was home 1 week for winter break.
2) Even though Bob’s son, Sam, turned 19 on Dec 2014, are there other circumstances that would allow Bob to still take a child dependency exemption for Sam?
3) Sam, who is a freshman at the University of Michigan full-time, worked part-time as a trainer for the football team during the school year and used $2,500 of his earnings to pay for required equipment and school supplies.
Sam’s grandparents gave him $1,000 as a birthday gift, which $500 of it he used to purchase his textbooks
To pay part of his tuition, Sam withdrew $1,500 from an account, set up by his parents on his tenth birthday, to help pay tuition.
Sam took out a $4,500 federal student loan, which he applied toward tuition, room, and board.
Sam’s parents used the proceeds of a $5,000 personal loan to make direct payments to U of M for tuition, room, and board.
Sam’s parents gave him $1,000 for clothing, gasoline, prescribed medications, and other personal expenses.
Sam’s parents paid $3,800 for lodging, utilities and food while Sam lived with them during the summer.
Can Sam’s parents take a child dependency exemption for him? Why or why not?
4) Lisa, whose parents are divorced, lived with her dad, Tom, for 210 nights in 2014 and with her mom, Mary, for 155 nights.
Assuming that Tom and Mary could both take a child dependency exemption for Lisa, does Tom or Mary take the dependent child exemption for Lisa? Why or why not?
5) In 2014, Anne, whose parents are divorced lived with her dad, Mark, and her mom, Ellen, lived for the same number of days during the year.
For 2014, Ellen’s AGI was $100,000 and Mark’s AGI was $99,000
Assuming all of the other requirements for a child dependency exemption were met, can Tom or Anne take the dependent child exemption for Anne? Why or why not?
6) Prior to going camp for 6 weeks in the summer of 2014, Linda lived with her mom, Renee, for 23 weeks and with her dad, Jack, for 23 weeks
In 2014, Jack’s AGI was $50,000 and Renee’s AGI was $40,000
For purposes of the dependent child exemption, how many weeks is Linda considered to have lived with each of her parents? Why?
Depending on your answer, does Renee or Jack take the dependent child exemption for Linda? Why or why not?
7) Sam, whose parents are separated, normally lives with his dad, Bob, during the week and with his mom, Ellen, every other weekend
When Sam’s dad became ill in 2014 and was hospitalized for 10 consecutive days, his mother lived with Sam in his dad’s home for those 10 days.
For purposes of the dependent child exemption, how is the 10 day period when Sam’s dad was hospitalized and his mom lived with him in his dad’s house allocated between his parents?
8) In 2014, Dean, who is single and has no children, earned $61,617 as a mechanic
Since 2012, Dean’s 83 year old widowed father, Bobbie, who earned $5,000 in dividend income in 2014, has lived with Dean
In 2014, Dean provided over half of his father’s support
On his 2014 tax return, can Dean claim a dependent relative exemption for his father? Why or why not?
9) For the last year, Grace, has lived with her daughter, Mary, her son-in-law husband, Frank and her grandchild, Erin
Grace received social security benefits of $2,400, which she spent on clothing, transportation, and recreation, and has no other source of income
Frank and Mary’s total food expense for the household was $5,200.
Frank and May paid Grace’s medical and drug expenses of $1,200.
The fair rental value of the lodging provided for Grace was $1,800 a year, based on the cost of similar rooming facilities.
Can Frank and Mary take a Dependent Relative Exemption for Mary’s mother, Grace Brown? Why or why not?
10) Cynthia, who is a US resident, and her husband, Kirk, who is a US resident alien, have 2 children, Kirk, age 7, and Susanne, age 6, who have lived with their parents for all of 2014 and all of them have their own social security numbers
In 2014, Cynthia earned $15,000 at her job and Jerry earned $10,000 at his job, plus they earned $525 in interest on their savings account
Like other years, Cynthia and Jerry’s filing status in 2014 will be married filing jointly
Can Cynthia and Kirk take an EIC? Why or why not?
11) In 2014, Sharon, who is a US resident alien, single, 63 years old, retired and cannot be claimed as a dependent by any one else received: 1) $9,000 from her part time job; and 2) a taxable pension of $6,000
On her 2014 tax return, can Sharon claim an EIC? Why or why not?
12) Kelly is 30 years old, a US citizen, a full time student at CSULA, single, has no children and lived with her parents for all of 2014
In 2014, Kelly earned $6,000 from her part time job and $20 of interest on her savings account
Does Kelly qualify as a child so that her parents could take a child dependency exemption for her on their 2014 tax return? Why or why not?
Based on your answer above, can Kelly claim an EIC on her 2014 tax return? Why or why not?
13) Based on the facts below, can Bob and Ellen take a child tax credit for their 2 children, Tom and Amy, and their nephew Nigel on their ? Why or why not?
Bob and Ellen claimed a child dependency exemption for their son, Tom, who turned 17 on December 30, 2014 and is a US citizen
Bob and Ellen’s daughter, Amy, turned 8 years old in 2014, is not a citizen of the United States, has an ITIN, and lived in Mexico all of 2014.
Bob and Ellen’s 10 year old nephew, Nigel, lived in the UK and qualifies as Bob and Ellen’s dependent
14) When Alice’s adoption of 10 year old Jack became final in 2014, Alice, who lives in Michigan, paid, in connection with adopting Jack, $10,000 in fees: 1) to the adoption agency; 2) her attorney to represent her in family court; and 3) airline ticket and hotel expenses to travel to CA to bring Jack to MI from CA.
Alice’s employer reimbursed her for $5,000 of her $10,000 worth of adoption expenses
For purposes of the taking an ATC:
Is Jack an eligible child? Why or why not?
Are the $10,000 of fees Alice paid to adopt Jack qualified adoption fees? Why or why not?
Based on your answers to question 1 and 2: 1) can Alice take an ATC?; 2) if she can take an ATC, how much could she take as an ATC?; and 3) in what year could she take the ATC?
15) When Renee adopted her 10 year old son, Mark, her total amount of her domestic adoption expenses were $12,000 , which she paid as follows: 1) $2,000 in 2012; 2) $3,000 in 2013; and 3) $7,000 in 2014, when the adoption became final.
Under Sec 23, what amounts and in what year can Renee take an ATC with respect to her total adoption expenses of $12,000 that she paid from 2012 to 2014?
16) Alice pays $10,000 to her mother, Liz, to take care of Alice’s sister, Betty, who is disabled, qualifies as Alice’s dependent relative and has lived with Alice for 7 months.
Can Alice claim a Dependent Care credit for her sister, Betty? Why or why not?
17) In 2014, Jack and Kay Ford’s MAGI was $70,000 and they claimed an exemption for their 18 year old daughter, Amy, who is a freshman and part-time student at Wayne State University (WSU) and is working towards earning her nursing degree
In 2014, Jack and Kay paid $20,000 towards Amy’s education, which included $10,000 for tuition, $1,000 for textbooks and $10,000 for her room and board.
Do all of Amy’s school expenses that her parents paid qualify as expenses under the AOC? Why or why not?
On their 2014, can Jack and Kay can claim an AOC? Why or why not?
18) Because Mary, who is an attorney, thought that improving her job skills would get her promoted to partner at her law firm, she took a legal research and writing course at a law school.
Can Mary claim a Lifetime Learning Credit for the tuition she paid to the law school?
19) In 2016, Max purchased and installed in his house the following: 1) $1,000 for central air conditioning; 2) $2,000 for energy efficient windows; and 3) $4,000 for a gas furnace.
For 2016, can Max claim a Nonbusiness Energy Property credit?
If so, how much would be Max’s credit?