In May, Jonathon left his wife Sarah. While the couple lives apart and has no contact with each other, they were not legally divorced. Sarah found herself having to financially provide for the couple's eleven year-old child. Sarah paid all the costs of maintaining the household. When it is time to complete their taxes Sarah has no idea how to get in contact with Jonathon. Considering these facts, what is Sarah's most favorable filing status? Group of answer choices Married Filing Jointly Head of Household Married Filing Separately Qualifying Widow(er) Single
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- Lance H. and Wanda B. Dean are married and live at 431 Yucca Drive, Santa Fe, NM 87501. Lance works for the convention bureau of the local Chamber of Commerce, and Wanda is employed part-time as a paralegal for a law firm. During 2018, the Deans had the following receipts: Wanda was previously married to John Allen. When they divorced several years ago, Wanda was awarded custody of their two children, Penny and Kyle. (Note: Wanda has never issued a Form 8332 waiver.) Under the divorce decree, John was obligated to pay alimony and child supportthe alimony payments were to terminate if Wanda remarried. In July, while going to lunch in downtown Santa Fe, Wanda was injured by a tour bus. Because the driver was clearly at fault, the owner of the bus, Roadrunner Touring Company, paid her medical expenses (including a one-week stay in a hospital). To avoid a lawsuit, Roadrunner also transferred 90,000 to her in settlement of the personal injuries she sustained. The Deans had the following expenditures for 2018: The life insurance policy was taken out by Lance several years ago and designates Wanda as the beneficiary. As a part-time employee, Wanda is excluded from coverage under her employers pension plan. Consequently, she provides for her own retirement with a traditional IRA obtained at a local trust company. Because the mayor is a member of the local Chamber of Commerce, Lance felt compelled to make the political contribution. The Deans household includes the following, for whom they provide more than half of the support: Penny graduated from high school on May 9, 2018, and is undecided about college. During 2018, she earned 8,500 (placed in a savings account) playing a harp in the lobby of a local hotel. Wayne is Wandas widower father who died on December 20, 2017. For the past few years, Wayne qualified as a dependent of the Deans. Federal income tax withheld is 4,200 (Lance) and 2,100 (Wanda). The proper amount of Social Security and Medicare tax was withheld. Determine the Federal income tax for 2018 for the Deans on a joint return by completing the appropriate forms. They do not want to contribute to the Presidential Election Campaign Fund. All members of the family had health care coverage for all of 2018. If an overpayment results, it is to be refunded to them. Suggested software: ProConnect Tax Online.Jenna, a paid preparer, is preparing a return for her neighbor and close friend, Gerald. Gerald wishes to claim the head of household filing status using his daughter, Sara, as a dependent. Jenna knows that Sara lived with Gerald's ex-wife (Sara's mother) all year. However, when she asked him about this, Gerald replied: "Oh, I understand that you have to ask that. Sara lived with me all year." Then he gave Jenna a knowing wink. Jenna should: Document her question and Gerald's answer and prepare the return claiming the filing status. Call Gerald's wife and verify that she will not file a return using the head of household status. Decline to prepare Gerald's return with the requested filing status. She may not ignore her personal knowledge, no matter what Gerald says. Obtain a signed statement from Gerald that he agrees to assume the risk of any consequences of the tax position claimed on the return.Ingrid (43) and Daniel (48) are married but have lived apart since March 15, 2020. They have no divorce decree or separate maintenance agreement. They are both U.S. citizens and have valid social security numbers. Ingrid will not file a joint return with Daniel. Ethan (16), their son, went with Ingrid when she moved out and has lived with her since. Ingrid paid all the household expenses after they moved out. She did sign Form 8332, Release/Revocation of Claim to Exemption for Child by Custodial Parent so Daniel could claim Ethan. Together, Ingrid and Daniel provided more than 50% of Ethan's support. Ethan provided 5% of his own support. Daniel's wages were $27,000; Ingrid's were $29,850; Ethan's gross income was $1,525. Ingrid had no foreign income or investment income. 1.What is Ingrid's correct and most favorable 2020 filing status? Single. Married filing jointly. Married filing separately. Head of household. Qualifying widow(er). 2.Is Ingrid eligible to claim the Child Tax Credit…
- Olivia is an unmarried attorney. Her friend Lana has fallen on hard times since she lost her job. Olivia allows Lana to reside with her for the entire year and provides over half of Lana’s support. Lana only earned $3,000 for the tax year. What is Olivia’s filing status? Group of answer choices a)Single, because even though Lana is a dependent, Lana is not related to Olivia. b)Single, because Lana is not a qualifying child, and only taxpayers with qualifying children can claim head of household. c)Head of Household, because Olivia has maintained a household for Lana for over ½ of the year. d)Head of Household, because Lana is Olivia’s qualifying relative, and Olivia has maintained a home for her for over ½ the tax year.Haley (age 48) and Myron (age 51) are married and filing a joint return. Myron has earned income of $42,000 and is not covered by an employer plan. Haley is a homemaker and does not work outside the home. What is the total amount they can deduct for contributions to traditional IRAs for both Haley and Myron? Select one: a. $6,500 b. $11,000 c. $13,000 d. $12,000Determine whether the individuals will qualify as the taxpayer's dependent in each of the following independent scenarios. Specify whether the dependent would come under the qualifying child category, the qualifying relative category, or "not applicable" (if the individual does not qualify as a dependent). a. Andy maintains a household that includes a cousin (age 12), a niece (age 18), and a son (age 26). All are full-time students. Andy furnishes all of their support, and all are "members of the household." Cousin Qualified dependent Niece Qualified dependent Son Qualified dependent Qualifying child Qualifying child Qualifying relative b. Mandeep provides all of the support of a family friend's son (age 20), who lives with her. She also furnishes most of the support of her stepmother, who does not live with her. Family friend's son Qualified dependent Stepmother Not a dependent Qualifying relative Qualifying relative c. Raul, a U.S. citizen, lives in Costa Rica. Raul's household…
- Bonnie and Jake (ages 35 and 36, respectively) are married with no dependents and live in Montana (not a community property state). Because Jake has large medical expenses, they seek your advice about filing sepa-rately to save taxes. Their income and expenses for 2021 are as follows: Bonnie’s salary Jake’s salary Interest income (joint) Rental loss from actively managed rental property Jake’s unreimbursed medical expenses All other itemized deductions:* Bonnie Jake $ 42,500 26,000 1,500 (23,000) 8,500 19,000 6,400 * None subject to limitationsDetermine whether Bonnie and Jake should file jointly or separately for 2021.Juan and Maria, who have two young children, are in the process of obtaining a divorce. Juan expects to have $250,000 of income each year while Maria expects to have $180,000 of income each year. Assume the children will live with Maria after the divorce and that Juan will pay child support. What advice can you provide them regarding the child credit? A. The child credit is phased out for single taxpayers with AGI above $400,000. Juan will be entitled to the child credit because his income is below the threshold. The credit is only available to taxpayers who claim the children as dependents, so it would be beneficial to allow Juan to claim the children. The tax savings received by Juan should be considered when the amount of child support that Juan must pay is being determined. B. Juan's AGI exceeds $200,000, but Maria's AGI does not. The child credit thus would be reduced if Juan claims it, but there would be no reduction if Maria claims it. Overall,…Kiara (31) is married. However, she and her two children, Xavier (3) and Shandra (5), moved back in with her parents in 2019, after she separated from her husband. She will not be filing a joint return with her husband. They are all U.S. citizens and have valid social security numbers. Kiara's divorce had not been finalized by the end of 2020, but her husband did not live with her during the year. The children stayed with him 150 nights and the rest of the nights with Kiara. He did not pay any of her household expenses. Since the separation, Kiara and her children have lived in the finished basement apartment that her parents used to rent to local college students. Kiara pays more than half the cost of maintaining the apartment, and neither of the children provided any of their own support. Kiara’s wages and AGI were $43,250; Xavier’s gross income was $0; Shandra’s was $0. Kiara had no other income including foreign income. Kiara will not be releasing any dependent exemptions she may…
- Please read the information and answer the questions: Jason, 39 and single, helps support his mother Maria, his son Jeff, his father Rod, his brother Mark, and his girlfriend Layla (not Jeff's mother), all of whom are U.S. citizens with SSNs and none of whom file a joint tax return with anyone else. Maria, Jeff, Rod, Mark and Layla cannot be claimed as dependents of anyone else (other than potentially Jason), and none of them are disabled. Jason has gross income of over $100,000 in 2020. Maria (Jason's mother), single, did not live with Jason at all in 2020. She lived in her own home across the street from Jason. Jason provided 80% of Maria’s support in 2020, and Maria's only income was municipal bond interest of $5,000. Jeff (Jason's son), 21, single, lived with Jason for all of 2020. Jeff was not a student. Jeff worked part-time and earned wages of $4,000. Jason provided 25% of Jeff’s support in 2020, and Jeff’s girlfriend provided 60% of Jeff’s support. Jeff provided 15% of his own…Paul, age 40 and single, has an 8-year-old son, Larry. Larry resides with his mother, Susan, in her home. Pursuant to the terms of their divorce, Paul properly claims Larry as a dependent on his income tax return. Paul pays child support payments to his ex-wife for the support of his child. Susan does not claim Larry as her dependent, but she does bear the economic burden of supporting the household in which they reside. What is the maximum amount of the 2020 standard deduction that Susan qualifies for? Oa. $12,400 Оb. S18,650 Oc. $20,300 а. Od. $24,800 Oe. Susan does not qualify for claiming a standard deduction. е.Bill and karen are divorced and the parents of one child who is in bill's custody. in order to work, bill pays karen to care for the child. assuming that karen did not reside with bill, can boll claim a deduction for the child care expenses he incurred?