Intuit Academy 1 Con nua on - Gross Income With
complete Ques ons and answers | Updated RATED A+
2026
Sandeep, 70, and Mary, 67, are married. Sandeep's unmarried brother, John, lives with them.
Their daughter is a U.S. ci!zen who has been living and working abroad for many years.
Based on this informa!on, which op!on is correct?
Gross Income
is the sum of the taxpayer's income earned in a year, which may include salary, dividends,
capital gains, interest income, royal!es, rental income, alimony, and re!rement distribu!ons.
Certain items subtracted from a taxpayer's gross income to calculate their AGI are referred to as
adjustments to income.
Adjusted gross income (AGI)
is a figure that the Internal Revenue Service uses to determine a taxpayer's income tax liability
for the year. The IRS calculates it by subtrac!ng certain adjustments from gross income, such as
educator expenses, student loan interest, and other adjustments.
Common Transac!ons as Exclusions:
Some common transac!ons as exclusions or deduc!ons from gross income are:
Educator expenses
Self-employment tax
Alimony payments
Early withdrawal penalty
Self-employed health insurance
Charitable contribu!ons
Tradi!onal IRA
Health savings account
Student loan interest
Jury duty
Alimony Payments
,Payment to Spouse
ex-spouse
former spouse
legal separa!on instrument
What expenses qualify
remarriage
death
court order
medical bills
housing costs
other expenses
person who is paying alimony will deduct to income
person who is receiving alimony will treat as a income
what informa!on needed to complete the schedule 1
Exact amount, Social Security number, date of divorce
Before December 31, 2018
Taxable consequences of alimony applies to divorce decrees
Early withdrawal penalty
early withdrawal, charged , maturity date
expenses qualify : deduct penal!es, drawing fundsdeferred interest .
How to report :
Interest income -form 1099-int
Deduc!on -form 1040 Schedule 1
Self-Employed Health Insurance
Net profit on schedule c
Deduct the cost
Who is eligible?
Medical, dental, vision, Supplemental, Long term care
self-employed taxpayer, tax payer spouse, tax payer dependents
Other rules: can't
, Deduct payments
Par!cipate in health plan- employer, spouses of tax payer employer, employer's of tax
dependent
What is the limit:
net self employment profit
one-half of the self-employment tax
Income Inclusion
Tradi!onal IRA
HSA
Student Loan Interest-maximum $2500
Income excluded from the IRS's calcula!on of income tax
Includes life insurance death benefit proceeds, child support, welfare, and municipal bond
income.
The exclusion rule is generally, if "income" cannot be used as or to acquire food or shelter, it's
not taxable.
Municipal bond income is only excludable up to a point.
Qualified Distribu!ons from Roth IRA
Taxpayers may take two distribu!ons from a Roth IRA: qualified and non-qualified. The primary
difference is this: qualified distribu!ons are made aGer a person reaches age 59½, when the
owner of the Roth IRA has become permanently disabled, or when the owner of the Roth IRA
has passed away. Non-qualified distribu!ons are made at any other !me. Addi!onally, the
taxpayer must have opened the Roth IRA for at least five years to qualify for distribu!ons.
Qualified distribu!ons
Requirements to be a qualified Roth IRA distribu!on include:
The distribu!on is made five years aGer the first day of the first taxable year for which a
contribu!on was made.
The distribu!on is made on or aGer age 59½.
The distribu!on is made because the taxpayer was disabled.
complete Ques ons and answers | Updated RATED A+
2026
Sandeep, 70, and Mary, 67, are married. Sandeep's unmarried brother, John, lives with them.
Their daughter is a U.S. ci!zen who has been living and working abroad for many years.
Based on this informa!on, which op!on is correct?
Gross Income
is the sum of the taxpayer's income earned in a year, which may include salary, dividends,
capital gains, interest income, royal!es, rental income, alimony, and re!rement distribu!ons.
Certain items subtracted from a taxpayer's gross income to calculate their AGI are referred to as
adjustments to income.
Adjusted gross income (AGI)
is a figure that the Internal Revenue Service uses to determine a taxpayer's income tax liability
for the year. The IRS calculates it by subtrac!ng certain adjustments from gross income, such as
educator expenses, student loan interest, and other adjustments.
Common Transac!ons as Exclusions:
Some common transac!ons as exclusions or deduc!ons from gross income are:
Educator expenses
Self-employment tax
Alimony payments
Early withdrawal penalty
Self-employed health insurance
Charitable contribu!ons
Tradi!onal IRA
Health savings account
Student loan interest
Jury duty
Alimony Payments
,Payment to Spouse
ex-spouse
former spouse
legal separa!on instrument
What expenses qualify
remarriage
death
court order
medical bills
housing costs
other expenses
person who is paying alimony will deduct to income
person who is receiving alimony will treat as a income
what informa!on needed to complete the schedule 1
Exact amount, Social Security number, date of divorce
Before December 31, 2018
Taxable consequences of alimony applies to divorce decrees
Early withdrawal penalty
early withdrawal, charged , maturity date
expenses qualify : deduct penal!es, drawing fundsdeferred interest .
How to report :
Interest income -form 1099-int
Deduc!on -form 1040 Schedule 1
Self-Employed Health Insurance
Net profit on schedule c
Deduct the cost
Who is eligible?
Medical, dental, vision, Supplemental, Long term care
self-employed taxpayer, tax payer spouse, tax payer dependents
Other rules: can't
, Deduct payments
Par!cipate in health plan- employer, spouses of tax payer employer, employer's of tax
dependent
What is the limit:
net self employment profit
one-half of the self-employment tax
Income Inclusion
Tradi!onal IRA
HSA
Student Loan Interest-maximum $2500
Income excluded from the IRS's calcula!on of income tax
Includes life insurance death benefit proceeds, child support, welfare, and municipal bond
income.
The exclusion rule is generally, if "income" cannot be used as or to acquire food or shelter, it's
not taxable.
Municipal bond income is only excludable up to a point.
Qualified Distribu!ons from Roth IRA
Taxpayers may take two distribu!ons from a Roth IRA: qualified and non-qualified. The primary
difference is this: qualified distribu!ons are made aGer a person reaches age 59½, when the
owner of the Roth IRA has become permanently disabled, or when the owner of the Roth IRA
has passed away. Non-qualified distribu!ons are made at any other !me. Addi!onally, the
taxpayer must have opened the Roth IRA for at least five years to qualify for distribu!ons.
Qualified distribu!ons
Requirements to be a qualified Roth IRA distribu!on include:
The distribu!on is made five years aGer the first day of the first taxable year for which a
contribu!on was made.
The distribu!on is made on or aGer age 59½.
The distribu!on is made because the taxpayer was disabled.
