H&R Block Income Tax Course || Error-free Answers 100%.
Due Diligence correct answers Requirements that tax professionals must follow when preparing
income tax returns.
Estimated Tax correct answers The amount of tax a taxpayer expects to owe for the year after
subtracting expected amounts withheld and certain refundable credits.
Estimated Tax Voucher correct answers A statement by an individual of (1) the amount of income
tax he estimates he will incur during the current taxable year on income that is not subject to
withholding, (2) the excess amount over that withheld on income which is subject to
withholding, and (3) his estimated self-employment tax.
Exemption from Withholding correct answers Status claimed on Form W-4 directing the
employer not to withhold federal income taxes from the employee.
Underpayment Penalty correct answers If a taxpayer did not pay enough tax on a timely basis
during the year, he may be required to pay an underpayment penalty.
Two Ways to Pay as You Go correct answers Withholding and Estimated Tax Payments
Form W-4 correct answers Employee's Withholding Allowance Certificate
Form 4868 correct answers Application for Automatic Extension of Time To File U.S. Individual
Income Tax Return
Amended Return correct answers A tax return filed on Form 1040X after the original return has
been filed.
Closed Year correct answers A tax year for which the statute of limitations has expired.
,Open Year correct answers A taxable year for which the statute of limitations has not yet expired.
Failure-to-File Penalty correct answers Generally 5% for each month or part of a month the
return is late, but not more than 25% of the tax not paid.
Failure to File correct answers Taxpayer fails to file the return by the due date, and there is a
balance due.
Form 1040X correct answers Amended U.S. Individual Income Tax Return
When can an amended return be filed? correct answers Within three years of the date the original
return was filed, or within two years of the date the tax was paid, whichever is later.
Can the 1040X be e-filed? correct answers No.
Portfolio Income and Losses correct answers Those from such sources as dividends, interest,
capital gains and losses, and royalties.
Schedule E correct answers Supplemental Income and Loss
Royalty correct answers Payments received for the right to extract natural resources from the
taxpayer's property or to use a taxpayer's literary, musical, or artistic creation.
Annuity correct answers A series of payments under a contract made at regular intervals over a
period of more than one year.
Beneficiary correct answers The owner or recipient of funds in an account, such as an IRA, or
from an insurance policy or will.
,Contribution correct answers When a person puts money into a retirement plan.
Defined Benefit Plan correct answers An employee benefit plan that provides determinable
benefits not based on employer profits.
Defined Contribution Plan correct answers An employee benefit plan that provides a separate
account for each person covered and pays benefits based on account earnings.
Disability Pension correct answers A taxable pension from an employer-funded disability plan or
a disability provision of a retirement plan.
Distribution correct answers When a person takes or receives money from a retirement plan.
Pension correct answers Generally a series of definitely determinable payments made to a
taxpayer after retirement from work.
Rollover correct answers A qualified transfer of funds from one tax-favored account to another,
usually of the same type.
Roth IRA correct answers A type of individual retirement arrangement in which contributions are
not tax deductible, earnings grow tax deferred, and qualified withdrawals are tax free.
Traditional IRA correct answers An individual retirement arrangement, contributions to which
may or may not be deductible depending on the taxpayer's AGI and whether or not he is covered
under an employer-sponsored retirement plan.
What is the full retirement age? correct answers For workers born before 1938, it is 65. For those
born after it is gradually being increased to 67.
, How much of a client's social security and equivalent tier 1 RR benefits may be taxable? correct
answers Up to 85%.
Form SSA-1099 correct answers Social Security Benefits
Form RRB-1099 correct answers Railroad Retirement Benefits
None of Social Security Benefits Taxable correct answers Single, Head of Household, Qualified
Widow - $0-$25,000; Married Filing Jointly - $0-$32,000
Up to 50% of Social Security Benefits Taxable correct answers Single, Head of Household,
Qualified Widow - $25,001-$34,000; Married Filing Jointly - $32,001-$44,000
Up to 85% of Social Security Benefits Taxable correct answers Single, Head of Household,
Qualified Widow - $34,001+; Married Filing Jointly - $44,001+; Married Filing Single - $1+
Fully Taxable Pension correct answers Pensions to which the taxpayer did not make after-tax
contributions or from which all pre-tax amounts have been recovered in previous years.
Partly Taxable Pensions correct answers Those pensions funded through employer plans to which
the employee contributed some after-tax money.
Form 1099-R correct answers Distributions from Pensions, Annuities, Retirement, or Profit-
Sharing Plans, IRAs, Insurance Contracts, Etc.
Exceptions to the Early Withdrawal Penalty correct answers 01 - The distribution was made to an
employee who separated from service during or after the year in which they reached age 55.
02 - The distribution is part of a series of substantially equal periodic payments, made at least
annually for the life of the participant or the life expenctancy of the participant.
03 - The distribution was made due to permanent and total disability.
Due Diligence correct answers Requirements that tax professionals must follow when preparing
income tax returns.
Estimated Tax correct answers The amount of tax a taxpayer expects to owe for the year after
subtracting expected amounts withheld and certain refundable credits.
Estimated Tax Voucher correct answers A statement by an individual of (1) the amount of income
tax he estimates he will incur during the current taxable year on income that is not subject to
withholding, (2) the excess amount over that withheld on income which is subject to
withholding, and (3) his estimated self-employment tax.
Exemption from Withholding correct answers Status claimed on Form W-4 directing the
employer not to withhold federal income taxes from the employee.
Underpayment Penalty correct answers If a taxpayer did not pay enough tax on a timely basis
during the year, he may be required to pay an underpayment penalty.
Two Ways to Pay as You Go correct answers Withholding and Estimated Tax Payments
Form W-4 correct answers Employee's Withholding Allowance Certificate
Form 4868 correct answers Application for Automatic Extension of Time To File U.S. Individual
Income Tax Return
Amended Return correct answers A tax return filed on Form 1040X after the original return has
been filed.
Closed Year correct answers A tax year for which the statute of limitations has expired.
,Open Year correct answers A taxable year for which the statute of limitations has not yet expired.
Failure-to-File Penalty correct answers Generally 5% for each month or part of a month the
return is late, but not more than 25% of the tax not paid.
Failure to File correct answers Taxpayer fails to file the return by the due date, and there is a
balance due.
Form 1040X correct answers Amended U.S. Individual Income Tax Return
When can an amended return be filed? correct answers Within three years of the date the original
return was filed, or within two years of the date the tax was paid, whichever is later.
Can the 1040X be e-filed? correct answers No.
Portfolio Income and Losses correct answers Those from such sources as dividends, interest,
capital gains and losses, and royalties.
Schedule E correct answers Supplemental Income and Loss
Royalty correct answers Payments received for the right to extract natural resources from the
taxpayer's property or to use a taxpayer's literary, musical, or artistic creation.
Annuity correct answers A series of payments under a contract made at regular intervals over a
period of more than one year.
Beneficiary correct answers The owner or recipient of funds in an account, such as an IRA, or
from an insurance policy or will.
,Contribution correct answers When a person puts money into a retirement plan.
Defined Benefit Plan correct answers An employee benefit plan that provides determinable
benefits not based on employer profits.
Defined Contribution Plan correct answers An employee benefit plan that provides a separate
account for each person covered and pays benefits based on account earnings.
Disability Pension correct answers A taxable pension from an employer-funded disability plan or
a disability provision of a retirement plan.
Distribution correct answers When a person takes or receives money from a retirement plan.
Pension correct answers Generally a series of definitely determinable payments made to a
taxpayer after retirement from work.
Rollover correct answers A qualified transfer of funds from one tax-favored account to another,
usually of the same type.
Roth IRA correct answers A type of individual retirement arrangement in which contributions are
not tax deductible, earnings grow tax deferred, and qualified withdrawals are tax free.
Traditional IRA correct answers An individual retirement arrangement, contributions to which
may or may not be deductible depending on the taxpayer's AGI and whether or not he is covered
under an employer-sponsored retirement plan.
What is the full retirement age? correct answers For workers born before 1938, it is 65. For those
born after it is gradually being increased to 67.
, How much of a client's social security and equivalent tier 1 RR benefits may be taxable? correct
answers Up to 85%.
Form SSA-1099 correct answers Social Security Benefits
Form RRB-1099 correct answers Railroad Retirement Benefits
None of Social Security Benefits Taxable correct answers Single, Head of Household, Qualified
Widow - $0-$25,000; Married Filing Jointly - $0-$32,000
Up to 50% of Social Security Benefits Taxable correct answers Single, Head of Household,
Qualified Widow - $25,001-$34,000; Married Filing Jointly - $32,001-$44,000
Up to 85% of Social Security Benefits Taxable correct answers Single, Head of Household,
Qualified Widow - $34,001+; Married Filing Jointly - $44,001+; Married Filing Single - $1+
Fully Taxable Pension correct answers Pensions to which the taxpayer did not make after-tax
contributions or from which all pre-tax amounts have been recovered in previous years.
Partly Taxable Pensions correct answers Those pensions funded through employer plans to which
the employee contributed some after-tax money.
Form 1099-R correct answers Distributions from Pensions, Annuities, Retirement, or Profit-
Sharing Plans, IRAs, Insurance Contracts, Etc.
Exceptions to the Early Withdrawal Penalty correct answers 01 - The distribution was made to an
employee who separated from service during or after the year in which they reached age 55.
02 - The distribution is part of a series of substantially equal periodic payments, made at least
annually for the life of the participant or the life expenctancy of the participant.
03 - The distribution was made due to permanent and total disability.
