COMPREHENSIVE TEST NO. 11

1.

Most taxpayers use either the tax table or the tax rate schedules to figure their tax. However, there are special methods of figuring your tax if your income includes certain items.
- A.
  
  True
- B.
  
  False
Correct Answer
B. False

Explanation
Publication 17; Page 203

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2.

If a child's interest, dividends and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
Publication 17; Pages 206 & 207

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3.

If a child's interest and dividend income (including capital gain distributions) total $10,000 or less, and the child meets certain other conditions, the parent(s) may be able to choose to include that income on the parent's return rather than file a return for the child.
- A.
  
  True
- B.
  
  False
Correct Answer
B. False

Explanation
Publication 17; Pages 206 & 207

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4.

If the parent does not or cannot choose to include the child's income on the parent's return, use Form 8615 to figure the child's tax.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
Publication 17' Page 207

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5.

Check the true statements below that would require Form 8615 to be filed for a child for tax year 2014.
- A.
  
  The child is required to file a return for 2014.
- B.
  
  The child was either 1) under age 18 at the end of the year, 2) age 18 at the end of the year and did not have earned income that was more than half of his/her support, or 3) was a full-time student at leas age 19 and under age 24 at the end of 2014 and did not have earned income that was more than half of his/her support.
- C.
  
  The child does not file a joint return for 2014.
- D.
  
  The child's investment income was more than $2000.
- E.
  
  At least one of the child's parents was alive at the end of 2014.
- F.
  
  ALL OF THE ABOVE.
Correct Answer
F. ALL OF THE ABOVE.

Explanation
Publication 17; Page 207 & Figure 31-B on page 209

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Comprehensive Test No. 11

Most taxpayers use either the tax table or the tax rate schedules to figure their tax. However, there are special methods of figuring your tax if your income includes certain items.

If a child's interest, dividends and other unearned income total more than $2,000, part of that income may be taxed at the parent's tax rate instead of the child's tax rate.

If a child's interest and dividend income (including capital gain distributions) total $10,000 or less, and the child meets certain other conditions, the parent(s) may be able to choose to include that income on the parent's return rather than file a return for the child.

If the parent does not or cannot choose to include the child's income on the parent's return, use Form 8615 to figure the child's tax.

Check the true statements below that would require Form 8615 to be filed for a child for tax year 2014.