Vita Tax Prep - Dependency Exemption

1. Bob is 22 and a full-time student for the entire year. During the tax year, he lived with his parents when he was not in the dorm. During the tax year, he worked part-time and earned $6,000, but that income did not amount to half of his total support. Does Bob pass the tests for a qualifying child?

Yes

No

Option 3

Option 4

Bob passes the tests for a qualifying child because he meets the age test (being under 24 and a full-time student) and the residency test (living with his parents for more than half the year). He also meets the support test since his part-time income of $6,000 does not amount to half of his total support. Therefore, he qualifies as a qualifying child for tax purposes.

Explanation

Bob passes the tests for a qualifying child because he meets the age test (being under 24 and a full-time student) and the residency test (living with his parents for more than half the year). He also meets the support test since his part-time income of $6,000 does not amount to half of his total support. Therefore, he qualifies as a qualifying child for tax purposes.

2. John is a 23-year-old single college student. His mother is entitled to claim him as a dependent on her tax return. Is John entitled to claim himself as a personal exemption on his own return?

Yes

No

Option 3

Option 4

John is not entitled to claim himself as a personal exemption on his own return because his mother is already claiming him as a dependent on her tax return.

Explanation

John is not entitled to claim himself as a personal exemption on his own return because his mother is already claiming him as a dependent on her tax return.

3. How much of a person's support must a taxpayer provide in order to claim that person as a dependent?

25%

33%

51%

75%

To claim a person as a dependent, a taxpayer must provide at least 51% of their support. This means that the taxpayer must contribute more than half of the person's financial needs, including things like housing, food, medical expenses, and education. Providing less than 51% of support would not meet the criteria for claiming someone as a dependent.

Explanation

To claim a person as a dependent, a taxpayer must provide at least 51% of their support. This means that the taxpayer must contribute more than half of the person's financial needs, including things like housing, food, medical expenses, and education. Providing less than 51% of support would not meet the criteria for claiming someone as a dependent.

4. Randy's son, Paul, is not a qualifying child. Paul earned $6,800 from a part-time job. Does he meet the gross income test for a qualifying relative?

Yes

No

Option 3

Option 4

Paul does not meet the gross income test for a qualifying relative because his income of $6,800 exceeds the maximum gross income limit set by the IRS. To be considered a qualifying relative, the individual's gross income must be below a certain threshold, which Paul's income exceeds. Therefore, the correct answer is "No."

Explanation

Paul does not meet the gross income test for a qualifying relative because his income of $6,800 exceeds the maximum gross income limit set by the IRS. To be considered a qualifying relative, the individual's gross income must be below a certain threshold, which Paul's income exceeds. Therefore, the correct answer is "No."

5. True or False? Jennifer Rawls, an eighteen-year-old single mother who can be claimed as a dependent by her parents, can claim her infant son as a dependent on her own tax return.

True

False

Option 3

Option 4

Jennifer Rawls, as a dependent, cannot claim her infant son as a dependent on her own tax return. According to the IRS rules, a dependent cannot claim another dependent. Since Jennifer can be claimed as a dependent by her parents, she does not meet the requirements to claim her son as a dependent on her own tax return. Therefore, the answer is false.

Explanation

Jennifer Rawls, as a dependent, cannot claim her infant son as a dependent on her own tax return. According to the IRS rules, a dependent cannot claim another dependent. Since Jennifer can be claimed as a dependent by her parents, she does not meet the requirements to claim her son as a dependent on her own tax return. Therefore, the answer is false.

6. Which of the following meets the member of household or relationship test for taxpayer John Smith?

John Smith's 10 year old cousin who lives with John's parents, but is supported by John

John's foster parent who did not live with John

Ohn's foster child who has lived with him for seven months and is cared for by John as his own

John's great aunt who did not live with him

John's foster child who has lived with him for seven months and is cared for by John as his own meets the member of household or relationship test for taxpayer John Smith. This is because the foster child has been living with John for a significant period of time and is being cared for by John as his own child.

Explanation

John's foster child who has lived with him for seven months and is cared for by John as his own meets the member of household or relationship test for taxpayer John Smith. This is because the foster child has been living with John for a significant period of time and is being cared for by John as his own child.

7. Jessica has been raising her son, Jim, alone since her husband died 5 years ago. In 2016, Jessica earned $25,000. Jim, who lives with Jessica, is single, and does not provide more than half of his own support. He was 19 years old on September 17, 2016. Jim is not a full-time student and is not disabled. He worked for a short time at a fast food restaurant and made about $1,800. Jessica and Jim are both U.S. citizens and have SSNs.Is Jim the qualifying child or qualifying relative of Jessica?

Jim meets the requirements for being Jessica's qualifying relative.

Jim is Jessica's qualifying child since he is her son.

Option 3

Option 4

Jim meets the requirements for being Jessica's qualifying relative because he is not a full-time student and is not disabled. He is also single and does not provide more than half of his own support. Additionally, Jim is Jessica's son and they both are U.S. citizens with SSNs.

Explanation

Jim meets the requirements for being Jessica's qualifying relative because he is not a full-time student and is not disabled. He is also single and does not provide more than half of his own support. Additionally, Jim is Jessica's son and they both are U.S. citizens with SSNs.

8. Diane and her brother each provide 20% of their grandmother's support for the year. Two persons who are not related to Diane's grandmother, and who do not live with her, provide the remaining 60% of her support equally. Who is entitled to the dependency exemption?

Diane

Diane's brother

One of the two persons providing the remaining 60% of support

No one

No one is entitled to the dependency exemption because no single person provided more than 50% of the grandmother's support for the year. Diane and her brother each provided 20% of the support, and the two other persons provided the remaining 60% equally. Therefore, no one meets the requirement to claim the dependency exemption.

Explanation

No one is entitled to the dependency exemption because no single person provided more than 50% of the grandmother's support for the year. Diane and her brother each provided 20% of the support, and the two other persons provided the remaining 60% equally. Therefore, no one meets the requirement to claim the dependency exemption.

9. Steve provides $4,000 toward his mother's support during the year. His mother has earned income of $600, nontaxable social security benefit payments of $4,800, and tax-exempt interest of $200. She uses all of these for her support. Can Steve claim his mother as a dependency exemption if she meets all other tests?

Yes

No

Option 3

Option 4

No, Steve cannot claim his mother as a dependency exemption. According to the rules for claiming a dependent, a qualifying relative cannot have a gross income greater than the exemption amount ($4,300 for 2021). In this case, the mother's total income ($600 + $4,800 + $200 = $5,600) exceeds the exemption amount, making her ineligible to be claimed as a dependent.

Explanation

No, Steve cannot claim his mother as a dependency exemption. According to the rules for claiming a dependent, a qualifying relative cannot have a gross income greater than the exemption amount ($4,300 for 2021). In this case, the mother's total income ($600 + $4,800 + $200 = $5,600) exceeds the exemption amount, making her ineligible to be claimed as a dependent.

10. In December 2015, Mary and her 6-year-old son, Ricky, moved in with their neighbor, Ellen, who lives down the street. Mary and Ricky lived with Ellen the entire 2016 year. Ellen paid all the household bills for her home and provided all the support for Mary and Ricky. She does not support anyone else. Mary did not have any income in 2016 and neither Mary nor Ricky are qualifying children of any other taxpayer. All are U.S. citizens and had valid SSNs.Even though they are not related to Ellen, both Mary and Ricky meet the tests to be her dependents under the rules for "Qualifying Relative." See the Volunteer Resource Guide (Tab C), table 2--Exemptions/Dependency.Does Ellen qualify to file Head of Household?

Yes

No

Option 3

Option 4

Ellen does not qualify to file Head of Household because she does not have a qualifying dependent. While Mary and Ricky meet the tests to be Ellen's dependents under the rules for "Qualifying Relative," they are not considered qualifying children for Ellen. In order to file as Head of Household, Ellen would need to have a qualifying child or relative who meets the specific criteria set by the IRS. Since she does not have a qualifying dependent, the correct answer is "No."

Explanation

Ellen does not qualify to file Head of Household because she does not have a qualifying dependent. While Mary and Ricky meet the tests to be Ellen's dependents under the rules for "Qualifying Relative," they are not considered qualifying children for Ellen. In order to file as Head of Household, Ellen would need to have a qualifying child or relative who meets the specific criteria set by the IRS. Since she does not have a qualifying dependent, the correct answer is "No."