HRB FINAL EXAM – HUMAN RESOURCE
BUSINESS / HUMAN RESOURCE MANAGEMENT |
COMPLETE EXAM QUESTIONS WITH DETAILED
SOLUTIONS .
What is the Difference between earned income and unearned income? - Answer Earned income is
received for services performed. Examples are wages commissions, tips and generally farming and
other business income . Taxable income other than that received services
for performed. Unearned
Income includes money received ro the investment of money or other property, such as interest,
dividends, and royalties. It also includes pensions alimony, unemployment compensation and
other income that is not earned
If an employee thinks their Form W2 is incorrect, what should they- Answer
do? Employee should
discuss with employer who issued the document and request a W2C. If no help from employer,
notify IRS. Tax prepaper can then file a substitute.
What information do you need to know to determine whether a taxpayer is required to file a
return?- Answer Gross income, filing status, age and if they are a dependent
For tax purposes, when is a person's marital status determined?
- Answer On the last day of the tax
year
Where on the tax form can you find the regular standard deduction amounts?
- Answer Line 22 on
1040A, In the left margin at the top of the page 2 of forms 1040 and 1040A. Look at actual form to
look for line
How much is added to the standard deduction if the taxpayer (or spouse is age 65 or older, or
blind? - Answer $1550 if unmarried, $1250 if married
What is the personal exemption amount for 2016?
- Answer $4,050
What two amounts are combined to make up the gross income filing requirments for most
taxpayers?- Answer The standard deduction and the personal exemption amounts
Under what circumstances might a taxpayer be required to file a return even though they do not
meet the gross income filing requirements?- Answer 1. Has net employment of $400 or more net
self employment 2. You had unemployment income you owe medicare antage
Adv MSA, receive
HAS, Archer, MSA 3. Reeived an Advanced Premium Tax credit even if they didn't otherwise have
a filing requirment for the year *Tips, HSA, SE $400, PTC
What is the difference between injured spouse allocation and innocent spouse- Answer
relief? The
difference between injured spouse and innocent spouse is significant in the eyes of the IRS. Both
,HRB FINAL EXAM – HUMAN RESOURCE
BUSINESS / HUMAN RESOURCE MANAGEMENT |
COMPLETE EXAM QUESTIONS WITH DETAILED
SOLUTIONS .
release you from an income tax liability arising from a "married filing jointly" return but different
outcomes. Innocent spouse filed a joint return byt was unaware that their spouse deliberately
under reported tax liability. Injured spouse seeks to protec
t his or her share of the refund in case it
gets seized or offset due to the other spouse's debts or unpaid obligations
CHAPTER 3: DEPENDENT EXEMPTIONS AND SUPPORT - Answer
What four requirements must be met for an individual to be claimed as a dependent - Answer Must
pass the dependent test, joint return test, citizenship, qualifying child or relative
What are the five tests for a qualifying child?
- Answer 1. Relationship 2. Age 3. Residency 4.
Support 5. Joint Return
How can a married individual meet the joint return test to remain a qualifying -child?
Answer
They can meet this test by not filing a joint return with their spouse or they can file a joint return
with their spouse if they are filing only to claim a refun
d on any taxes withheld
How can you determine who paid more than half of a person's support?
- Answer Total support is
determined and reduced by the funds received by and for the person from all sources other than
the taxpaer. The remaining support is considered to be provided
theby
taxpayer. Other sources
might include government support Worksheet for Determining Support
What happens if an individual is a qualifying child of more than one taxpayer?
- Answer Generally,
the custodial parent is the one in which the child spent the most nights
What happens when more than one taxpayer claims the same qualifying-child? Answer Tie
Breaker Rules apply : 1. The parent, if only one of the persons is the childs parent 2. The parent
with whom the child lived the longest during the tax 3. The parents
ith the
w highest AGI if no
parent can claim the child as a qualifying child
What four tests must be met for an individual to be considered a qualifying relative?
- Answer 1.
Not be a qualifying child, the person cannot be the taxpayers qualifying child or the qualifying
child of another taxpayer 2. Relationship: Child, brother,
ster,
si step sister, step brother, step father
, step mother, in
-laws 3. Gross Income: gross income must be less than $4050 4. Support: Taxpayer
must provide more than half the support
, HRB FINAL EXAM – HUMAN RESOURCE
BUSINESS / HUMAN RESOURCE MANAGEMENT |
COMPLETE EXAM QUESTIONS WITH DETAILED
SOLUTIONS .
How can the gross income for a qualifying relative test be satisfied?
- Answer Gross income must
be less than $4050 (Do not include tax exempt income)
What is the purpose of Form 2120 Multiple Support Declaration?
- Answer You only need 2120
multiple support declaration if you are claiming someone other than a qualifying child as a
dependent and there are two or more people including yourself who provide
support for the
dependent
How much is the child tax credit worth?
- Answer $1,000
What additional requirements must be met for a taxpayer to be eligible to claim the Child Tax
Credit for the qualifying child?
- Answer 1. Taxpayer 2. Child must be under17 at the end of the
year 3. Qualifying child must be claimed on tax payer returnsQualifying
4. child must be US
Citizen US National or resident of US
Is the Child Tax Credit refundable or nonrefundable
- Answer CTC is nonrefundable the The
additional child tax credit is refundable
How much is the penalty if a paid prepaerer fails to meet the child tax credit due diligence
requirements- Answer $510 for each failure, for each credit on each return Total Penalty max for
return is $1530
What is the first due diligence requirement for the EITC, CTC,ACTC, AOTC and how does a paid
preparer meet this requirement? - Answer Complete and submit the form 8867. 1. Complete the
form thoroughly and conscientously read the form carefully 2. submit
e form
th on every claim for
eitc, ctc/actc and aotc
CHAPTER 4: DEPENDENT -RELATED FILING STATUS - Answer
What filing statuses are available to taxpayers who are unmarried
- Answer 1. Single 2. Head of
Household 3. Qualifying widow(er)
How may a married taxpayer qualify as unmarried for tax purposes?
- Answer Must be legally
seperated under a decree of divorce or separate maintenance or meet these requirements: 1. must
file a separate return 2. must have provided more than half the
of cost
maintaining a household 3.
the home must have been the principle place of abode
BUSINESS / HUMAN RESOURCE MANAGEMENT |
COMPLETE EXAM QUESTIONS WITH DETAILED
SOLUTIONS .
What is the Difference between earned income and unearned income? - Answer Earned income is
received for services performed. Examples are wages commissions, tips and generally farming and
other business income . Taxable income other than that received services
for performed. Unearned
Income includes money received ro the investment of money or other property, such as interest,
dividends, and royalties. It also includes pensions alimony, unemployment compensation and
other income that is not earned
If an employee thinks their Form W2 is incorrect, what should they- Answer
do? Employee should
discuss with employer who issued the document and request a W2C. If no help from employer,
notify IRS. Tax prepaper can then file a substitute.
What information do you need to know to determine whether a taxpayer is required to file a
return?- Answer Gross income, filing status, age and if they are a dependent
For tax purposes, when is a person's marital status determined?
- Answer On the last day of the tax
year
Where on the tax form can you find the regular standard deduction amounts?
- Answer Line 22 on
1040A, In the left margin at the top of the page 2 of forms 1040 and 1040A. Look at actual form to
look for line
How much is added to the standard deduction if the taxpayer (or spouse is age 65 or older, or
blind? - Answer $1550 if unmarried, $1250 if married
What is the personal exemption amount for 2016?
- Answer $4,050
What two amounts are combined to make up the gross income filing requirments for most
taxpayers?- Answer The standard deduction and the personal exemption amounts
Under what circumstances might a taxpayer be required to file a return even though they do not
meet the gross income filing requirements?- Answer 1. Has net employment of $400 or more net
self employment 2. You had unemployment income you owe medicare antage
Adv MSA, receive
HAS, Archer, MSA 3. Reeived an Advanced Premium Tax credit even if they didn't otherwise have
a filing requirment for the year *Tips, HSA, SE $400, PTC
What is the difference between injured spouse allocation and innocent spouse- Answer
relief? The
difference between injured spouse and innocent spouse is significant in the eyes of the IRS. Both
,HRB FINAL EXAM – HUMAN RESOURCE
BUSINESS / HUMAN RESOURCE MANAGEMENT |
COMPLETE EXAM QUESTIONS WITH DETAILED
SOLUTIONS .
release you from an income tax liability arising from a "married filing jointly" return but different
outcomes. Innocent spouse filed a joint return byt was unaware that their spouse deliberately
under reported tax liability. Injured spouse seeks to protec
t his or her share of the refund in case it
gets seized or offset due to the other spouse's debts or unpaid obligations
CHAPTER 3: DEPENDENT EXEMPTIONS AND SUPPORT - Answer
What four requirements must be met for an individual to be claimed as a dependent - Answer Must
pass the dependent test, joint return test, citizenship, qualifying child or relative
What are the five tests for a qualifying child?
- Answer 1. Relationship 2. Age 3. Residency 4.
Support 5. Joint Return
How can a married individual meet the joint return test to remain a qualifying -child?
Answer
They can meet this test by not filing a joint return with their spouse or they can file a joint return
with their spouse if they are filing only to claim a refun
d on any taxes withheld
How can you determine who paid more than half of a person's support?
- Answer Total support is
determined and reduced by the funds received by and for the person from all sources other than
the taxpaer. The remaining support is considered to be provided
theby
taxpayer. Other sources
might include government support Worksheet for Determining Support
What happens if an individual is a qualifying child of more than one taxpayer?
- Answer Generally,
the custodial parent is the one in which the child spent the most nights
What happens when more than one taxpayer claims the same qualifying-child? Answer Tie
Breaker Rules apply : 1. The parent, if only one of the persons is the childs parent 2. The parent
with whom the child lived the longest during the tax 3. The parents
ith the
w highest AGI if no
parent can claim the child as a qualifying child
What four tests must be met for an individual to be considered a qualifying relative?
- Answer 1.
Not be a qualifying child, the person cannot be the taxpayers qualifying child or the qualifying
child of another taxpayer 2. Relationship: Child, brother,
ster,
si step sister, step brother, step father
, step mother, in
-laws 3. Gross Income: gross income must be less than $4050 4. Support: Taxpayer
must provide more than half the support
, HRB FINAL EXAM – HUMAN RESOURCE
BUSINESS / HUMAN RESOURCE MANAGEMENT |
COMPLETE EXAM QUESTIONS WITH DETAILED
SOLUTIONS .
How can the gross income for a qualifying relative test be satisfied?
- Answer Gross income must
be less than $4050 (Do not include tax exempt income)
What is the purpose of Form 2120 Multiple Support Declaration?
- Answer You only need 2120
multiple support declaration if you are claiming someone other than a qualifying child as a
dependent and there are two or more people including yourself who provide
support for the
dependent
How much is the child tax credit worth?
- Answer $1,000
What additional requirements must be met for a taxpayer to be eligible to claim the Child Tax
Credit for the qualifying child?
- Answer 1. Taxpayer 2. Child must be under17 at the end of the
year 3. Qualifying child must be claimed on tax payer returnsQualifying
4. child must be US
Citizen US National or resident of US
Is the Child Tax Credit refundable or nonrefundable
- Answer CTC is nonrefundable the The
additional child tax credit is refundable
How much is the penalty if a paid prepaerer fails to meet the child tax credit due diligence
requirements- Answer $510 for each failure, for each credit on each return Total Penalty max for
return is $1530
What is the first due diligence requirement for the EITC, CTC,ACTC, AOTC and how does a paid
preparer meet this requirement? - Answer Complete and submit the form 8867. 1. Complete the
form thoroughly and conscientously read the form carefully 2. submit
e form
th on every claim for
eitc, ctc/actc and aotc
CHAPTER 4: DEPENDENT -RELATED FILING STATUS - Answer
What filing statuses are available to taxpayers who are unmarried
- Answer 1. Single 2. Head of
Household 3. Qualifying widow(er)
How may a married taxpayer qualify as unmarried for tax purposes?
- Answer Must be legally
seperated under a decree of divorce or separate maintenance or meet these requirements: 1. must
file a separate return 2. must have provided more than half the
of cost
maintaining a household 3.
the home must have been the principle place of abode
