2026 Your Self-Prep Tax Return CLAIM CREDITS–MAXIMIZE YOUR REFUND!

2026 RETURNS VITA Advanced Course Test/Retest:

2026-09-29T17:01:00.000-07:00

2026 Advanced Course Scenarios Test/Retest Questions – Answers with Solutions;

IRS 2025 Vita Advanced Course Test 91.43% Pass Proof:

IRS Important Changes for 2026 returns:

IRS Inflation Adjustments for 2026:

1. $32,200 Standard Deduction for married couples filing jointly.
2. $16,100 Standard Deduction for single filers and married individuals filing separately.
3. $24,150 Standard Deduction for heads of households.
4. $24,500 401(k) contribution limit.
5. $7,500 IRA limit.
6. IRS 2026 catch up contributions:
For 2026, the IRS allows a standard age 50+ catch-up contribution of $8,000 for 401(k).

Get ready to file 2026 returns. Four electronic filing options for individual taxpayers are available and listed below:

1. IRS Free File Fillable Forms: If you are comfortable using tax forms and do your own taxes, and your adjusted gross income is $73,000 or less.
2. Free Tax Return Preparation VITA Site.
3. Use Commercial Tax Prep Software (TaxSlayerPre) to prepare and file your taxes.
4. Find an Authorized e-file Provider:
Tax pros accepted by IRS electronic filing program are authorized IRS e-file providers. They are qualified to prepare, transmit and process e-filed returns.

IRS Important Changes for 2026 returns:

Due Date of Return:
The due date for filing individual income tax returns (Form 1040) for the 2026 tax year is April 15, 2027.
Major IRS tax form and publication changes for the 2026 tax year:>

IRS Advanced Course Scenarios and Test Questions:

Advanced Scenario 1: Fay Lewis - Interview Notes:

• Fay’s husband, Joe, moved out of their home in March of 2024. Fay has had no contact with Joe since he moved out. Fay and Joe are not legally separated.
• Fay has one child, Sallie, age 11. She will claim Sallie as a dependent on her 2026 tax return.
• Fay is 31 years old.
• Fay earned $46,000 in wages (including $1,000 in qualified tips reported on her Form W-2). Fay received $75 of interest.
• Fay paid all the costs of keeping up her home. She provided over half of the support for Sallie.
• They all are U.S. citizens and have valid Social Security numbers. They lived in the U.S. all year.

Advanced Scenario 1: Test Questions:

1. Fay does not qualify for Head of Household filing status.
a. True
b. False Answer

Solution:
Even though Fay is still married to her husband Joe, she meets the requirements to be considered unmarried for filing status purposes and qualifies to file as Head of Household. Although technically she could file as Married Filing Separately, it would not be to her advantage to do so.
2. Who qualifies to claim the Earned Income Credit (EIC) also known as Earned Income Tax Credit (EITC) for Sallie?
a. Fay ANSWER
b. Joe
c. Both Fay and Joe
d. Neither Fay nor Joe

Solution:
For Fay to qualify for the EITC, she must have:
1. Have worked and earned income under $51,593 AGI for one child, in the tax year 2026.
2. Have investment income no more than $12,200 in the tax year 2026.
3. And have a valid Social Security Number by the due date of her 2026 tax return.
3. Fay is required to report her qualified tips as income and is allowed to take an Additional Deduction for Qualifying Tips on her federal tax return.
a. True ANSWER
b. False

Solution:
Qualifying Tips: Taxpayers can deduct up to $25,000 of qualified tips on their federal returns under the "No Tax on Tips" rule. To qualify, you must work in an approved occupation, hold a valid SSN, file jointly if married, and have a modified adjusted gross income under $150,000 ($300,000 for joint filers).

Advanced Scenario 1 Retest Questions:

1. What is the most beneficial allowable filing status that Fay is eligible to claim on her 2026 tax return?
a. Qualifying Surviving Spouse b. Head of Household ANSWER
c. Married Filing Separately d. Single 2. Based on the information provided, Fay does not qualify for the Earned Income Tax Credit (EITC).
a. True b. False ANSWER
3. Fay will get an Additional Deduction for Qualifying Tips on her federal tax return.
a. True ANSWER
b. False

Advanced Scenario 2 Jeff and Jane Spring-Interview Notes:

• Frank and Molly are married and want to file a joint return.
• Frank and Molly are both U.S. citizens and have valid Social Security numbers. They resided in the United States all year with their children.
• Frank and Molly have two children, Betty, age 8, and David, age 17. Betty and David are U.S. citizens and have valid Social Security numbers.
• Frank earned $33,000 in wages.
• Molly earned $21,000 in wages.
• In order to work, the Springs paid $2,000 to their son, David, to care for Betty after school.
• Frank and Molly provided all of the support for their two children.

Advanced Scenario 2 Frank and Molly Spring - Test Questions:

4. For whom can Frank and Molly claim the Child Tax Credit (CTC).
a. Betty Answer b. David c. Both David and Betty d. Neither David nor Betty

Solution:
The Child Tax Credit (CTC) for the 2026 tax year is worth up to $2,200 per qualifying child under the age of 17.
The child tax credit (CTC) for the 2026 tax year is a nonrefundable credit that allows taxpayers to claim a tax credit of up to $2,200 per qualifying child.

5. The Springs do not qualify for the Child and Dependent Care Credit.
a. True Answer
b. False

Solution:
You can claim the IRS Child and Dependent Care Credit for payments made to a relative, provided the relative is not your spouse, the parent of the qualifying child, or your dependent. If your child (including a stepchild or foster child) is the care provider, they must have been 19 or older by the end of the tax year and cannot be claimed as your dependent.
Resources:
Form 2441 and Instructions, Child and Dependent Care Expenses and Publication 503, Child and Dependent Care Expenses.

Advanced Scenario 2 Jeff and Jane Spring - Retest Questions:

4. Frank and Molly are eligible to claim the Child Tax Credit (CTC).
a. True ANSWER
b. False
Solution:
The maximum amount taxpayers can claim for the child tax credit is $2,200 for each qualifying child. The amount claimed on Form 1040 depends on the taxpayer’s filing status, modified adjusted gross income (MAGI) and tax liability.
5. Payments made to David can not be claimed on Form 2441 as Child and Dependent Care Expenses.
a. True ANSWER
b. False
Solution:
What if the taxpayer makes payments to a relative? Payments to relatives may qualify as work-related expenses if the taxpayer does not claim the relative as a dependent and is 19 years or older by the end of the tax year.

Advanced Scenario 3 Donna Johnston - Interview Notes:

• Donna Johnston, age 58, is single.
• Donna earned wages of $51,000 and was enrolled the entire year in a high deductible health plan (HDHP) with self-only coverage.
• During the year, Donna contributed $2,100 to her Health Savings Account (HSA), and her uncle also contributed $1,000 to Donna's HSA.
• Donna's Form W-2 shows $1,200 in Box 12 with code W. She has Form 5498-SA showing $4,300 in Box 2.
• Donna has Form 1099-SA showing her HSA distributions. She used her distributions to pay the following
unreimbursed expenses:
o $900 for nine visits to a physical therapist after her knee surgery
o $1,400 unreimbursed doctor bills
o $440 prescription medicine
o $2,000 replacement of a crown
o $700 deep cleaning for teeth
o $40 over the counter medication
o $260 gym membership (for her general health and fitness)
• Donna is a U.S. citizen with a valid Social Security number.

Advanced Scenario 3 Donna Johnston - Test Questions:

6. Donna is eligible to contribute an additional $__________ to her HSA because she is age 55 or older.
a. $2,000
b. $1,100
c. $1,000 ANSWER
d. $0
Solution:
Health Savings Account (HSA) Contribution Limits on Deductions;
For 2026, the annual contribution limits on deductions for HSAs for individuals with self-only coverage is $4,150 and $8,300 for family coverage. Reference: IRS 2026 Publication 969.
There is an additional contribution amount of $1,000 for taxpayers who are age 55 or older.
7. Looking at Form 8889, Health Savings Accounts (HSA), Part I is used to report contributions made by _________. a. Donna b. Donna's uncle c. Donna's employer d. All of the above ANSWER
Solution:
Form 8889, Part 1, is used to report all HSA contributions and to compute the allowable HSA deduction. This includes contributions made by the filing deadline for the tax year. Contributions made by an employer are also shown in Part I, but are not included in the deductible amount.
8. What is the total unreimbursed qualified medical expenses reported on Form 8889, Part II?
a. $5,440 b. $5,480 ANSWER
c. $5,700 d. $5,740 Solution:
Gym membership $260 is not a qualified medical expense. You can deduct on Schedule A (Form 1040) only the amount of your medical and dental expenses that is more than 7.5% of your AGI.
You can't include membership dues in a gym, health club, or spa. Even a fee for weight loss program unless prescribed by a doctor.
Reference:
Publication 502, Medical and Dental Expenses.

Advanced Scenario 3 Rose Jones - Retest Questions:

6. Rose cannot include her mother's contribution on Form 8889, Part 1.
a. True
b. False ANSWER
Solution:
Family members or any other person may also contribute on behalf of an eligible individual. Contributions to an HSA must be made in cash.
7. Rose is eligible to contribute an additional $2,000 to her HSA because she is age 55 or older.
a. True
b. False ANSWER
8. The over the counter medicine is a qualified medical expense for HSA purposes.
a. True ANSWER
b. False
Solution:
IRS says yes, over the counter medicine is a qualified medical expense for HSA purposes and may be paid or reimbursed by an HSA.

Advanced Scenario 4 Olivia Peas - Interview Notes:

• Olivia, age 62, is single. She owns her home and provided all the costs of keeping up her home for the entire year. Her only income for 2026 was $48,700 in Form W-2 wages.
• Jill, age 24, and her daughter Grace, age 5, have lived with Jill's mother, Olivia, since Jill separated from her spouse in May of 2025. Jill's only income for 2026 was $24,000 in wages. Jill provided over half of her own support. Grace did not provide more than half of her own support.
• Jill will not file a joint return with her spouse.
• All individuals in the household are U.S. citizens with valid Social Security numbers; no one has a disability; and they lived in the United States all year.

Advanced Scenario 4 Olivia Peas - Test Questions:

9. Which of the following statements is true:
a. Jill may not claim Grace as a dependent since Olivia paid all of their housing costs.
b. Only Jill may claim Grace as a dependent since Grace is her daughter.

c. Only Olivia may claim Grace as a dependent since her income is higher than Jill's income.

d. Olivia may claim Grace as a dependent if Jill chooses not to claim her. ANSWER
Solution:
To Be a Qualifying Child. What are the rules for a qualifying child of more than one person?
Sometimes a child meets the tests to be a qualifying child of more than one person. A child who meets the conditions to be a qualifying child of more than one person can only be claimed by one taxpayer for the EIC.
10. Grace is a qualifying child for Jill to claim the Earned Income Tax Credit (EITC).
a. True ANSWER
b. False
Solution:
File Schedule EIC Earned Income Credit (Form 1040) if you have a qualifying child even if that child doesn't have a valid SSN.
Reference:
p596 2026 IRS Publication Earned Income Credit (EIC).

Advanced Scenario 4 Chery Brown-Retest Questions:

9. Either Cindy or Chery can claim Andrea as a dependent.
a. True ANSWER
b. False
10. Which of the following statements is true?
a. Cindy is not eligible to claim Cary for the EIC because her filing status is married filing separate.
b. Cindy is not eligible to claim the EIC for Cary because she is under age 25.
c. Cindy is not eligible to claim Cary for the EIC because her income is too high.
d. None of the above statements is true. ANSWER

Advanced Scenario 5 Max Stone - Interview Notes:

• Max is 54 years old and files as single.
• His 2026 adjusted gross income (AGI) is $52,000, which includes gambling winnings of $3,000.
• Max would like to itemize his deductions on Form 1040 Schedule A this year.
• Max brings documents for the following items:
o $10,500 hospital and doctor bills
o $1,000 contributions to Health Savings Account (HSA)
o $3,600 state withholding (higher than the calculated state sales tax deduction)

o $500 personal property taxes based on the value of the vehicle

o $800 friend’s personal GoFundMe campaign
o $500 cash contributions to the Red Cross
o $200 fair market value of clothing (in good used condition) donated to the Salvation Army (Max purchased the clothing for $900)
o $7,300 mortgage interest
o $2,300 real estate tax
o $1,600 Mortgage Insurance Premiums
o $2,000 gambling losses

Advanced Scenario 5 Elizabeth Greene - Test Questions:

11. Max can claim the $1,600 Mortgage Insurance Premiums (MIP) as a deduction on his Form 1040, Schedule A.
a. True
b. False ANSWER
Solution:
Real estate taxes; some real estate taxes or charges that may be included on the real estate tax bill are not deductible. These include Mortgage Insurance Premiums.
12. What amount of gambling losses is Max eligible to claim as a deduction on his Form 1040, Schedule A?
a. $0
b. $1,000
c. $1,800
d. $2,000 ANSWER
Solution:
What miscellaneous expenses are deductible?
Examples of miscellaneous itemized deductions include:
Gambling losses and expenses (through 2024) to the extent of gambling winnings (taxpayers must have a record of their losses).

Advanced Scenario 5 Elizabeth Greene-Retest Questions:

11. If Elizabethn chooses to itemize, which of the following is she not eligible to claim as a deduction on Form 1040, Schedule A?
a. $7,300 mortgage interest
b. $1,500 Homeowner's Association fees ANSWER
c. $2,300 real estate tax
d. $350 contribution to the Red Cross
12. Elizabeth is eligible to claim $2,000 in gambling losses as a deduction on her Form 1040, Schedule A.
a. True ANSWER
b. False

Advanced Scenario 6 David Stone-Interview Notes:

• Vince Baldy is 28 years old and single. He provides all of his own support.
• Vince works at a gas station and earned $20,000 in wages.
• Vince is a full-time student in his second year at the state college pursing a bachelor degree. Vince does not have a felony drug conviction. He wants to know if that qualifies for any educational tax benefit.
• Vince took two early distributions from his IRA which had a balance of $5,000. One was $2,000 for tuition, and the other was $750 for emergency car repairs. This is the first time he has taken a distribution from his IRA.
• Vince is a U.S. citizen and lived in the U.S. for the entire year. He has a valid Social Security number.

Advanced Scenario 6 Vince Baldy - Test Questions:

13. Vince is eligible to claim the American Opportunity Credit on his 2026 tax return.
a. True
b. False ANSWER
Solution:
To be eligible for AOTC, the student must:
1. Be pursuing a degree or other recognized education credential.
2. Be enrolled at least half time for at least one academic period* beginning in the tax year.
3. Not have finished the first four years of higher education at the beginning of the tax year.
Reference:
IRS Publication 970, Tax Benefits for Education.
14. For which of the following IRA distributions will Vince not owe an additional tax of 10%?
a. $2000 for tuition.
b. $750 for emergency car repairs
c. Both a and b. ANSWER
d. Neither a nor b.
Solution:
The additional tax is equal to 10% of the portion of the distribution that's includible in gross income.
Reference:
IRS 2024 Topic no. 557, Additional tax on early distributions from traditional and Roth IRAs.

Advanced Scenario 6 David Stone-Retest Questions:

13. David's modified adjusted gross income (MAGI) must be less than $90,000 to claim the Lifetime Learning Credit in 2024.
a. True ANSWER
b. False
14. David will owe an additional $50 tax on the $500 IRA distribution for emergeny repair?
a. True ANSWER
b. False

Advanced Scenario 7 Vincent and Faith Hunter – Interview Notes:

• Vincent is a 5th grade teacher at a public school. Vincent and Faith are married and choose to file Married Filing Jointly on their 2024 tax return.
• Vincent worked a total of 1,800 hours in 2024. During the school year, he spent $844 on unreimbursed classroom expenses.
• Faith retired in 2021 and began receiving her pension on November 1st of that year. She explains that this is a joint and survivor annuity. She has already recovered $1,259 of the cost of the plan.
• Vincent settled with his credit card company on an outstanding bill and brought the Form 1099-C to the site. They aren’t sure how it will impact their tax return for tax year 2024. The Hunters determined that they were solvent as of the date of the canceled debt.
• Faith received $280 from Jury duty.
• Their daughter, Hope, is in her second year of college pursuing a bachelor’s degree in Physics at a qualified educational institution. She received a scholarship and the terms require that it be used to pay tuition. Box 2 was not filled in and Box 7 was not checked on her Form 1098-T for the previous tax year. The Hunters provided Form 1098-T and an account statement from the college that included additional expenses. The Hunters paid $1500 for books and equipment required for Hope's courses. This information is also included on the college statement of account. The Hunters claimed the American Opportunity Credit last year for the first time.
• Hope does not have a felony drug conviction.
• They are all U.S. citizens with valid Social Security numbers.

2024 Faith Hunter’s FEDERAL TAX RETURN DOCUMENTS:
FORM W-2 Wages: 1. Wages $37,353, 2. Federal Tax Withheld $3200, 17. State Tax $500
FORM 1099-R Annuities: 1. Gross Distribution $20,100, 4. Federal Tax Withheld $2010, 7. Distribution Code 7, 9b. Total Employee Contribution $15,000
FORM SSA-1099 Social Security Bemefit: 5. Net Benefit $23,899, 6. Federal Tax Withholding $2390
FAITH HUNTER'S TOTAL TAX = $7600 ($2390 + $2010 + $3200)

FAITH HUNTER'S TOTAL INCOME = 75486 (37353 + 19419 + 1050 + 19464)
INCOME:
W-2 35353 (12A. D 1000 EMPLOYEE RETIREMENT CONTRIBUTION)
1099-R 19419 INCOME
1099-C 850 INCOME (CANCELLATION OF DEPT SCH1 LINE 8C)
JURY 280 SCHEDULE 1 LINE 8H
SSA-1099 19464 (22899X.85=19464 TAXABLE INCOME)
TOTAL INCOME 75486 – 300 EDUCATOR EXPENSES = 75186 ADJUSTED INCOME LINE 11
MINUS 29200 = 45986 TAXABLE INCOME (F1040 LINE 15
TAX FROM TAX TABLE 5077
5077-(500 CREDIT FOR OTHER DEP+1393 SCH3 LINE 8) = 3184
3184 THIS IS YOUR TOTAL TAX (F1040 LINE 24)
TOTAL PAYMENTS 7490 + 928 = 8418 (F1040 LINE 33)
REFUND TO YOU 8418 – 3184 = 5234 (SUBTRACT LINE 24 FROM LINE 33)
PAYMENTS 1040 LINE 29 (981) (FROM FORM 8863 LINE 8)
EDUCATION CREDITS F8863 LINE 8 928 AND Form 1040 LINE 29
CREDIT Amount from Schedule 3, line 3 1393 (F8863 LINE 19 1393) F1040 Line 20

Advanced Scenario 7 Matthew and Rebecca Monroe – Test Questions:
15. What is the taxable portion of Rebecca's pension from Riverside Enterprises using the simplified method?
a. $0
b. $18,741
c. $19,419 ANSWER
d. $20,000
SOLUTION:
1963 Taxpayer Born 1954 Spouse Born
2023-1963=60 Taxpayer’s Age
2023-1954=69 Spouse’s Age
69+60=129-3=126 Combine Age at 2020 Pension Start Date (2023-2020=3) from table 2 for Line 3 = 310
Simplified Method Worksheet – Lines 5a and 5b

16. All of Rebecca’s social security benefits are taxable according to the social security benefits worksheet.
a. True
b. False ANSWER
17. What is the total amount of other income reported on the Monroe's Form 1040, Schedule 1?
a. $200
b. $850
c. $1,050 ANSWER
d. $4,152
SOLUTION:
$850 Cancelled Debt + $200 Jury Duty = 1050.
18. Matthew is eligible to deduct qualified educator expenses in the amount of $____________. 300 ANSWER
SOLUTION:
1. Eligible educators can deduct up to $300 of qualified expenses paid during the tax year. An eligible educator is a kindergarten through grade 12 teacher, who worked in a school for at least 900 hours during a school year.
2. If you were an eligible educator in 2023, you can deduct qualified expenses up to $300 you paid in2023 in the Adjustments to Income section of Schedule 1 (FORM 1040), Line 11.
19. What is the Monroe's standard deduction on their 2023 tax return?
a. $20,800
b. $27,700
c. $29,200 ANSWER
d. $30,700
20. Which of the following expenses qualify for the American opportunity credit?
a. Required course related books and equipment
b. Tuition
c. Parking pass
d. Both a and b ANSWER
21. The Monroes are eligible to claim the credit for other dependents on their tax return.
a. True ANSWER
b. False
22. What is the Monroe’s total federal income tax withholding?
a. $5,200
b. $5,490
c. $6,200
d. $7,490 ANSWER
SOLUTION:
$7,490 (3,200 + 2,000 + 2.290)

Advanced Scenario 7 Matthew and Rebecca Monroe – Retest Questions:
15. The taxable portion of Rebecca's pension from Riverside Enterprises using the simplified method is $19,419.
a. True ANSWER
b. False
16. The taxable amount of Rebecca's social security income is:
a. $0
b. $18,630
c. $19,464 ANSWER
d. $22,899
17. The total amount of other income reported on the Monroe's Form 1040, Schedule 1 is $1,050.
a. True ANSWER
b. False
SOLUTION: Cancellation of debt $850 Jury duty pay $200.
18. What is the amount Matthew is eligible to claim as qualified educator expenses on Form 1040, Schedule 1?
a. $0
b. $250
c. $300 ANSWER
d. $733
SOLUTION:
1. Eligible educators can deduct up to $300 of qualified expenses paid during the tax year. An eligible educator is a kindergarten through grade 12 teacher, who worked in a school for at least 900 hours during a school year.
2. If you were an eligible educator in 2023, you can deduct qualified expenses up to $300 you paid in 2023 in the Adjustments to Income section of Schedule 1 (FORM 1040), Line 11.
19. The Monroe's standard deduction on their Form 1040 for tax year 2023 is $27,700.
a. True
b. False ANSWER
20. Which is not a qualifying expense for the American opportunity credit?
a. Parking pass ANSWER
b. Required course related books
c. Tuition
d. Required course related equipment
21. Which of the following credits are the Monroes able to claim on their federal tax return?
a. Earned Income Credit
b. American Opportunity Credit ANSWER
c. Child Tax Credit
d. Premium Tax Credit
SOLUTION:
1. Taxpayers can take education credits for themselves, their spouse or dependents, claimed on the tax return, who were enrolled and attended an eligible postsecondary educational institution during the tax year.
2. The IRS tax law requires that the student must generally receive a Form 1098-T, Tuition Statement, in order for the taxpayers to claim the education credit.
22. The federal income tax withholding reported on the Monroe's Form 1040 is $5,200.
a. True
b. False ANSWER
SOLUTION:
$7,490 (3,200 + 2,000 + 2.290)

Advanced Scenario 7 Matthew and Rebecca Monroe-1040 2023 RETURN PAGE 1 2 AND 3 using free TaxSlayer-Pro Practice Lab Software:

Schedule 1 line 10=$850, Schedule 3 line 8=$1393, Schedule 8812=$500, Form 8863 line 8=$928, Total Tax line 24 $3172, Total Payments line 33=$8418, Refund: $8418 Subtract $3172=$5246:

Advanced Scenario 8 Julia Oakley-Interview Notes:
• Julia is a data entry clerk, age 26, and single.
• Julia has investment income and a consolidated broker’s statement.
• Julia is self-employed delivering groceries for Quick Market on the weekends. She received a Form 1099-NEC and a Form 1099-K. She received additional cash payments of $535.
• Julia uses the cash method of accounting. She uses business code 492000.
• Julia provided a statement from the grocery delivery service indicating the fees paid for the year. These fees are considered ordinary and necessary for the grocery delivery business:
o $150 for insulated box rental
o $50 for vehicle safety inspection (required by Quick Market)
o $600 for Quick Market fees
• Julia also kept receipts for the following out-of-pocket expenses:
o $80 for business parking
o $300 for speeding ticket
o $160 for Julia's lunches
• Julia’s record keeping application shows she has driven a total of 2,500 miles during and between deliveries.
o She placed her only vehicle, an SUV, in service on 3/15/2020. The total mileage on her SUV for tax year 2023 was 12,000 miles. Of that, 9,500 miles were personal and commuting miles. Julia will take the standard business mileage rate.
• Julia is paying off her student loan from 2017, when she completed her undergraduate degree.
• Julia is working towards her Master of Education degree to start a new career as an Associate Professor. She took a few college courses this year at an accredited college.
• Julia took an early distribution of $3,000 from her IRA in April. She used $2,400 of the IRA distribution to pay her educational expenses for the current year.
• If Julia has a refund, she would like it deposited into her checking account.

Advanced Scenario 8 Julia Oakley-Test Questions:
23. What is the net long term capital gain reported on Julia's Schedule D?
a. $350
b. $2,100
c. $2,450 ANSWER
d. $6,100
24. Which of the following can be claimed as a business expense on Julia's Schedule C?
a. Business Parking ANSWER
b. Speeding Ticket
c. Lunches
d. All of the above
25. Julia can take a student loan interest deduction of $3,250. a. True
b. False ANSWER
26. What is the total standard mileage deduction for her business on Schedule C? a. $983
b. $1,638 ANSWER
c. $2,500
d. $2,518
27. The amount of Julia's lifetime learning credit is $480.
a. True ANSWER
b. False
28. What is Julia's additional 10% tax on the early withdrawal from her IRA?
a. $0
b. $60 ANSWER
c. $240
d. $300
29. How can Julia prevent having a balance due next year?
a. She can increase the withholding on her Form W-4.
b. She can make estimated tax payments.
c. She can use the IRS withholding calculator to estimate her withholding for next year.
d. All of the above ANSWER

Advanced Scenario 8 Julia Oakley-Retest Questions:
23. Julia's net long term capital gain reported on Schedule D is $1,700
. a. True
b. False ANSWER
24. Julia can claim the speeding ticket as a business expense on her Schedule C.
a. True
b. False ANSWER
25. What is the amount Julia can take as a student loan interest deduction on her Form 1040, Schedule 1?
a. $0
b. $750
c. $2,500 ANSWER
d. $3,250
26. The total standard mileage deduction for Julia's business on Schedule C is $983.
a. True
b. False ANSWER
27. Julia meets the qualifications to claim the American Opportunity Credit.
a. True
b. False ANSWER
28. Julia will have to pay $60 additional tax because she received the early distribution from her IRA.
a. True ANSWER
b. False
29. Julia can make estimated tax payments to avoid owing tax next year.
a. True ANSWER
b. False

LIST OF SCHEDULES AND FORMS:
FORM 1040 PAGE1
FORM 1040 PAGE2
1. SCHEDULE 1 – PART I (ADDITIONAL INCOME) TOTAL ADDITIONAL INCOME LINE 10 =4549 (on FORM 1040 LINE 8 ENTER 4549):
2. SCHEDULE 1 – PART II (ADJUSTMENTS TO INCOME) TOTAL ADJUSTMENTS TO INCOME LINE 26 =2822 (on FORM 1040 LINE 10 ENTER 2822):
3. SCHEDULE 2 – PART II (OTHER TAXES) TOTAL OTHER TAXES LINE 21 =703 (on FORM 1040 LINE 23 ENTER 703):
4. SCHEDULE 3 – PART I (NONREFUNDABLE CREDITS) LINE 8 =480 (on FORM 1040 LINE 20 ENTER 480):
5A. SCHEDULE B (INTEREST)LINE 4 =15 (on FORM 1040 LINE 2b ENTER 15):
5B. SCHEDULE B (ORDINARY DIVIDENTS) LINE 6 =300 (on FORM 1040 LINE 3b ENTER 300):
6. SCHEDULE C (BUSINESS INCOME)LINE 31 =4549 ENTER on BOTH SCHEDULE 1 LINE 3 =4549 AND on SCHEDULE SE LINE 2 =4549 (on FORM 1040 LINE 8 ENTER 4549):
7A. SCHEDULE D (CAPITAL GAINS/LOSSES) – PART I SHORT-TERM LOSS: LINE 7 =-750:
7B. SCHEDULE D (CAPITAL GAINS/LOSSES) – PART II LONG-TERM GAIN LINE 15 =2450:
7C. SCHEDULE D (CAPITAL GAINS/LOSSES) – PART III SUMMARY LINE 16 =1700 (2450-750=1700) (on FORM 1040 LINE 7 ENTER 1700):
8. SCHEDULE SE (SELF-EMPLOYMENT TAX) LINE 12 =643 (on SCHEDULE 2 LINE 4 ENTER 643) AND LINE 13 =322 DEDUCTION FOR ONE-HALF OF SE TAX (on SCHEDULE 1 LINE 15 ENTER 322) AND (on FORM 1040 LINE 23 ENTER 703 FROM SCHEDULE 2 LINE 21):
9. FORM 5329 (TAX ON EARLY RETIREMENT DISTRIBUTIONS)
10. FORM 8863 (EDUCATIOANAL DREDITS) – PART II (NONREFUNDABLE EDUCATION CREDUTS) LINE 19 =480 (on SCHEDULE 3 LINE 3 ENTER 480) FROM SCHEDULE 3 LINE 8 =480 (on FORM 104O LINE 29 ENTER 480:
11. FORM 8995 (QUALIFIED BUSINESS INCOME DEDUCTION) LINE 15 =851 (on FORM 1040 LINE 13 ENTER 851:

Advanced Scenario 8 Julia Oakley-1040 2023 RETURN PAGE 1 AND 2 using free TaxSlayer Pro-Practice Lab Software:

1. OAKLEY SCHEDULE 1 – PART I (ADDITIONAL INCOME) TOTAL ADDITIONAL INCOME LINE 10 =4549 (on FORM 1040 LINE 8 Enter 4549):

2. SCHEDULE 1 – PART II (ADJUSTMENTS TO INCOME) TOTAL ADJUSTMENTS TO INCOME LINE 26 =2822 (on FORM 1040 LINE 10 ENTER 2822):

3. SCHEDULE 2 – PART II (OTHER TAXES) TOTAL OTHER TAXES LINE 21 =703 (on FORM 1040 LINE 23 ENTER 703):

4. SCHEDULE 3 – PART I (NONREFUNDABLE CREDITS) LINE 8 =480 (on FORM 1040 LINE 20 ENTER 480):

5A. SCHEDULE B (INTEREST) LINE 4 =15 (on FORM 1040 LINE 2b ENTER 15:

5B. SCHEDULE B (ORDINARY DIVIDENTS) LINE 6 =300 (on FORM 1040 LINE 3b ENTER 300:

6. SCHEDULE C (BUSINESS INCOME) LINE 31 =4549 ENTER on BOTH SCHEDULE 1 LINE 3 =4549 AND on SCHEDULE SE LINE 2 =4549 (on FORM 1040 LINE 8 ENTER 4549):

7A. SCHEDULE D (CAPITAL GAINS/LOSSES) – PART I SHORT-TERM CAPITAL LOSS LINE 7 =-750:

7B. SCHEDULE D (CAPITAL GAINS/LOSSES) – PART II LONG-TERM GAIN LINE 15 =2450:

7C. SCHEDULE D (CAPITAL GAINS/LOSSES) – PART III SUMMARY LINE 16 =1700 (2450-750=1700) (on FORM 1040 LINE 7 ENTER 1700):

8. SCHEDULE SE (SELF-EMPLOYMENT TAX)LINE 12 =643 (on SCHEDULE 2 LINE 4 ENTER 643) AND LINE 13 =322 DEDUCTION FOR ONE-HALF OF SE TAX (on SCHEDULE 1 LINE 15 ENTER 322) AND (on FORM 1040 LINE 23 ENTER 703 FROM SCHEDULE 2 LINE 21):

9. FORM 5329 (TAX ON EARLY RETIREMENT DISTRIBUTIONS) LINE 4 =60 (on SCHEDULE 2 LINE 8 ENTER 60):

10. FORM 8863 (EDUCATIOANAL DREDITS) – PART II (NONREFUNDABLE EDUCATION CREDUTS) LINE 19 =480 (on SCHEDULE 3 LINE 3 ENTER 480) FROM SCHEDULE 3 LINE 8 =480 (on FORM 104O LINE 29 ENTER 480:

11. FORM 8995 (QUALIFIDE BUSINESS INCOME DEDUCTION) LIND 15 =851 (on FORM 1040 LINE 13 ENTER 851):

NOTE FOR LINE 1i AND COLUMN c) Qualified business income or (loss):
NET PROFIT FROM SCHEDULE C =4549 MINUS DEDUCTIBLE Self-Employment TAX =322 (4549-322 = 4227).

Advanced Scenario 9 David MacLee-Interview Notes:
• David is age 40 and was widowed in July, 2022. He has a daughter, Linda, age 8, who lived with him the entire year. • David provided the entire cost of maintaining the household and over half of the support for Linda. In order to work, he pays childcare expenses to Uptown Daycare. • David purchased health insurance for himself and his daughter through the Marketplace. He received a Form 1095-A. • David and Linda are U.S. citizens and lived in the United States all year in 2023.
Advanced Scenario 9 David MacLee-Test Questions:
30. What is David's most advantageous filing status?
a. Single
b. Married Filing Separately
c. Head of Household
d. Qualifying Surviving Spouse (QSS) ANSWER
31. David MacLee's adjusted gross income on his Form 1040 is _______.
a. $8,404
b. $36,000
c. $36,104 ANSWER
d. $36,130
32. David cannot claim which of the following credits on his tax return.
a. Child Tax Credit
b. Credit for Other Dependents ANSWER
c. Premium Tax Credit
d. Child and Dependent Care Credit
33. David's retirement savings contributions credit on Form 8880 is $________. 100 ANSWER
34. The total amount of David's net premium tax credit on Form 1040 Schedule 3, line 9 is $696.
a. True ANSWER
b. False
35. David's child and dependent care credit from Form 2441 is reported as a non-refundable credit on Form 1040, Schedule 3.
a. True ANSWER
b. False

Advanced Scenario 9 David MacLee-Retest Questions:
30. David is eligible to claim the Qualifying Surviving Spouse filing status.
a. True ANSWER
b. False
31. David's adjusted gross income is $36,130.
a. True
b. False ANSWER
32. David is eligible to claim the child tax credit.
a. True ANSWER
b. False
33. David qualifies to claim a retirement savings contribution credit.
a. True ANSWER
b. False
34. David's net premium tax credit on his Schedule 3, line 9 is $_______. 696 ANSWER
35. David's child and dependent care credit is refundable in 2023.
a. True
b. False ANSWER
Taxpayers with children under the age of 17 may be eligible to claim a tax credit of up to $2,000 per qualifying dependent. For 2023, $1,600 of the credit is potentially refundable. We'll cover who qualifies, how to claim it.

Advanced Scenario 9 David MacLee-1040 2023 RETURN PAGE 1 AND 2 using free TaxSlayer Pro-Practice Lab Software:

2023 1040 LINE 16 843 TAX ON 8404 INCOME MACLEE:

2023 MACLEE 1040 LINE 19 Child tax credit or credit for other dependents from SCHEDULE 8812 LINE 14:

2023 MACLEE 1040 LINE 27 EARNED INCOME CREDIT (EIC) SCHEDULE EIC QUALIFYING CHILD INFORMATION:

2023 MACLEE 1040 LINE 27 EARNED INCOME CREDIT (EIC) Worksheet A—2023 EIC—Line 27:

2023 1040 MACLEE SCHEDULE 8812 LINE 13 Enter the amount from Credit Limit Worksheet A:

2023 MACLEE 1040 LINE 28 ADDITIONAL CHILD TAX CREDIT FROM SCHEDULE 8812 PAGE 2 LINE 27:

2023 DAVID MACLEE 1040 SCHEDULE 1 ADJUSTMENTS AND SCHEDULE 3 CREDITS:

SCHEDULE 3 NONREFUNDABLE CREDITS 2023:
2441 LINE 2 SCHEDULE 3 Credit for child and dependent care expenses from Form 2441, line 11. Attach Form 2441.
8880 LINE 4 SCHEDULE 3 Retirement savings contributions credit. Attach Form 8880.

SCHEDULE 3 REFUNDABLE CREDITS 2023:
8962 LINE 9 SCHEDULE 3 Net premium tax credit. Attach Form 8962.

2023 Advanced Exam Score 94.29% Proof:

2023 Advanced Exam Incorrect Quesitions:
23. What is the net long term capital gain reported on Julia’s Schedule D?
$2,100 Incorrect Answer: $2100+$350=$2450 Correct Answer.
Review the Publication 4491, Capital Gains and Losses lesson and
Publication 4012 Tab D, Capital Gains and Losses.

26. What is the total standard mileage deduction for her business on Schedule C?
$2,500 Incorrect Answer: 2500x0.655=$1,638 Correct Answer.
65.5 cents per mile driven for business use.
Review the Publication 4491, Business Expenses lesson and
Publication 4012 Tab D, Income, Schedule C – Car and Truck Expenses.
=100% Pass.

2022 Advanced Course Scenarios Test/Retest Questions – Answers with Solutions;

2022 Advanced Test/Retest – 100% Pass Proof;

Advanced Scenarios 1 through 9 – Test/Retest Questions;

Directions:
The first six scenarios do not require you to prepare a tax return. Read the interview notes for each scenario carefully and use your training material IRS Publication 4491 2022 VITA Training Guide, and your resource material IRS Publication 4012 2022 VITA Resource Guide to answer the questions after the scenarios.
Chris Spalding – Interview Notes: • Chris’s husband, George, moved out of their home in February of 2022. She had no contact with him since he moved out. Chris and George are not legally separated.
• Chris has one child, Mary, age 9. She will claim Mary as a dependent on her 2022 tax return. Chris is 31 years old.
• Chris earned $36,200 in wages and received $50 of interest. Chris was out of work for a month and received unemployment income of $1,800.
• Chris paid all the costs of keeping up her home. She provided over half of the support for Mary.
• They all are U.S. citizens and have valid social security numbers. They lived in the U.S. all year.

Chris Spalding – Test Questions;
1. What is the most beneficial of the following filing statuses that Chris is eligible to claim on her 2022 tax return?
a. Single
b. Married Filing Separately
c. Qualifying Surviving Spouse (QSS)
d. Head of Household Answer
Chris Spalding – Question 1 Explanation:
The question 1 correct answer is Head of Household. Even though Chris is still married to her husband, she meets the requirements to be “considered unmarried” for filing status purposes and qualifies to file as Head of Household. Although technically she could file as Married Filing Separately, it would not be to her advantage to do so.
2. Based on the information provided, Chris qualifies for the earned income credit.
a. True Answer b. False
Chris Spalding – Question 2 Explanation:
For Chris Spalding to qualify for the EITC, she must have: Have worked and earned income under $57,414. Have investment income below $10,000 in the tax year 2022. And have a valid Social Security Number by the due date of her 2022 tax return.
3. What amount of Chris's unemployment compensation is taxable? $______________.
$1,800 Answer. Chris Spalding – Question 3 Explanation:
Unemployment compensation is taxable income. If you receive unemployment benefits, you generally must include the payments in your income when you file your federal income tax return.

Chris Spalding – Retest Questions;

Chris Spalding – Retest Questions;
1. Chris's most beneficial allowable filing status is Single.
a. True b. False Answer

Chris Spalding – Retest Question 1 Explanation:
Although she could file as Married Filing Separately, it would be not to her advantage.

2. Mary is a qualifying child for the earned income credit.
a. True Answer b. False

Chris Spalding – Retest Question 2 Explanation:

To qualify for the EITC, a qualifying child must:

Your child must have Valid Social Security Number for employment.

Your child must be under age 19 at the end of the year and younger than you.

Your child must be your Son, daughter, stepchild, adopted child or foster child.

Your child must live in the same home as you in the United States for more than half of the tax year.
3. All of Chris's unemployment compensation is taxable.
a. True Answer b. False

Chris Spalding – Retest Question 3 Explanation:

Unemployment compensation is taxable income. If you receive unemployment benefits, you must include the payments in your income when you file your federal income tax return.

Adam and Lisa Garcia – Interview Notes:
• Adam and Lisa are married and want to file a joint return.
• Adam is a U.S. citizen and has a valid Social Security number. Lisa is a resident alien and has an ITIN. They resided in the United States all year with their children.
• Adam and Lisa have two children, Maria, age 11, and Luis, age 17. Maria and Luis are U.S. citizens and have valid Social Security numbers.
• Adam earned $22,000 in wages.
• Lisa earned $20,000 in wages.
• In order to work, the Garcias paid $2,000 to their son Luis to care for Maria after school.
• Adam and Lisa provided all of the support for their two children.

Adam and Lisa Garcia – Test Questions;
4. What is the maximum amount Adam and Lisa are eligible to claim for the child tax credit?
a. $2,000 Answer
b. $3,000
c. $4,000
d. $6,000
Adam and Lisa Garcia – Question 4 Explanation:

Child tax credit (CTC) is not refundable.

2022 CTC is $2,000 for each qualifying child.

Must have a Social Security number that is valid for employment issued before the due date of the return, including extensions.

A child must be under age 17 at the end of 2022 to be a qualifying child.

5. The Garcias qualify for the child and dependent care credit.
a. True b. False Anawer
Adam and Lisa Garcia – Question 5 Explanation:
IRS Topic No. 602 Child and Dependent Care Credit:
Payments to Relatives or Dependents – The care provider can't be your spouse, the parent of your qualifying individual if your qualifying individual is your child and under age 13, your child who is under the age of 19, or a dependent whom you or your spouse may claim on your return.
Can a family member get paid for childcare IRS?
These payments may be qualified childcare expenses if the family member babysitting isn't your spouse, the parent of the child, your dependent, or your child under age 19, and if you otherwise qualify to claim the child and dependent care credit.

Adam and Lisa Garcia Interview Notes:
• Adam and Lisa are married and want to file a joint return.
• Adam is a U.S. citizen and has a valid Social Security number. Lisa is a resident alien and has an ITIN. They resided in the United States all year with their children.
• Adam and Lisa have two children, Maria, age 11, and Luis, age 17. Maria and Luis are U.S. citizens and have valid Social Security numbers.
• Adam earned $22,000 in wages.
• Lisa earned $20,000 in wages.
• In order to work, the Garcias paid $2,000 to their son Luis to care for Maria after school.
• Adam and Lisa provided all of the support for their two children.

Adam and Lisa Garcia – Retest Questions:
4. The maximum amount Adam and Lisa are eligible to claim for the Child Tax Credit is $4,000.
a. True b. False Answer

Adam and Lisa Garcia – Test Question 4 Explanation:

Child tax credit (CTC) is not refundable. 2022 CTC is $2,000 for each qualifying child. Must have a Social Security number that is valid for employment issued before the due date of the return, including extensions. A child must be under age 17 at the end of 2022 to be a qualifying child.
5. Payments made to Luis can be claimed on Form 2441 as child and dependent care expenses.
a. True b. False Answer

Adam and Lisa Garcia – Question 5 Explanation:

irs Topic No. 602 Child and Dependent Care Credit:

Payments to Relatives or Dependents – The care provider can't be your spouse, the parent of your qualifying individual if your qualifying individual is your child and under age 13, your child who is under the age of 19, or a dependent whom you or your spouse may claim on your return.

Jenny Smith – Interview Notes:
• Jenny Smith, age 57, is single.
• Jenny earned wages of $52,000 and was enrolled the entire year in a high deductible health plan (HDHP) with self-only coverage.
• During the year, Jenny contributed $2,000 to her Health Savings Account (HSA) and her mother also contributed $1,000 to Jenny's HSA account.
• Jenny's Form W-2 shows $650 in Box 12 with code W. She has Form 5498-SA showing $3,650 in Box 2.
• Jenny took a distribution from her HSA to pay her unreimbursed expenses:
o 8 visits to a physical therapist after her knee surgery $400
o unreimbursed doctor bills for $900
o prescription medicine $200
o replacement of a crown $1,500
o over the counter medication $40
o gym membership $240
• Jenny is a U.S. citizen with a valid Social Security number.

Jenny Smith – Test Questions:
6. Form 8889, Part 1 is used to report HSA contributions made by _______________.
a. Jenny
b. Jenny's employer
c. Jenny's mother
d. All of the above Answer
Jenny Smith – Question 6 Explanation:
7. Jenny is eligible to contribute an additional $1,000 to her HSA because she is age 55 or older.
a. True Answer b. False

Jenny Smith – Question 7 Explanation:
8. What is the total unreimbursed qualified medical expenses reported on Form 8889, Part II?
a. $2,640
b. $3,000
c. $3,040 Answer
d. $3,280
Jenny Smith – Question 8 Explanation:
2022 Publication 502 You can't include membership dues in a gym, health club, or spa as medical expenses, but you can include separate fees charged there for weight loss activities.

Jenny Smith – Retest Question:
6.Jenny can include her mother's contribution on Form 8889, Part 1.
a. True Anawer b. False

Jenny Smith Retest Question 6 – Explanation:
7. Jenny is eligible to contribute an additional $_________________ 1000 to her HSA because she is age 55 or older.

Jenny Smith – Retest Question 7 Explanation:

Those 55 and older can contribute an additional $1,000 as a catch-up contribution.
8. The gym membership is a qualified medical expense for HSA purposes.
a. True b. False Answer

Alice Adams – Interview Notes:
• Alice, age 58, is single. She owns her home and provided all the costs of keeping up her home for the entire year. Her only income for 2022 was $46,000 in W-2 wages.
• Linda, age 24, and her daughter Nancy, age 4, moved in with Linda's mother, Alice, after she separated from her spouse in April of 2020. Linda's only income for 2022 was $25,000 in wages. Linda provided over half of her own support. Nancy did not provide more than half of her own support.
• Linda will not file a joint return with her spouse.
• All individuals in the household are U.S. citizens with valid Social Security numbers. No one has a disability. They lived in the United States all year.

Alice Adams – Test Questions;
9. For the purpose of determining dependency, Nancy could be the qualifying child of _______________.
a. Only Alice
b. Only Linda
c. Either Alice or Linda Answer
d. Neither Alice nor Linda
Alice Adams – Question 9 Explanation;
10. Linda is not eligible to claim Nancy for the earned income credit because her filing status is Married Filing Separate.
a. True b. False> Answer
Alice Adams – Question 10 Explanation:
To figure the credit, see Publication 596, Earned Income Credit 2022. When you file Form 1040 or 1040-SR, you must attach Schedule EIC to your return to claim the EIC with a qualifying child.
Special rule for separated spouses: You can claim the EIC if you are married, not filing a joint return, had a qualifying child who lived with you for more than half of 2022 and either of the following apply:
1. You lived apart from your spouse for the last 6 months of 2022, or
2. You are legally separated according to your state law under a written separation agreement or a decree of separate maintenance and you didn't live in the same household as your spouse at the end of 2022.

9. Linda is the only person that qualifies to claim Nancy as a dependent.
a. True b. False Answer

Alice Adams – Retest Question 9 Explanation:
10. Which of the following statements is true?
a. Linda is not eligible to claim Nancy for the EIC because her filing status is married filing separate.
b. Linda is not eligible to claim the EIC for Nancy because she is under age 25.
c. Linda is not eligible to claim Nancy for the EIC because her income is too high.
d. None of the above statements are true. Answer

Alice Adams Retest Question 10 – Explanation:

Ellen Black Interview Notes:
• Ellen is 48 years old and files as single.
• Her 2022 adjusted gross income (AGI) is $51,000, which includes gambling winnings of $2,000.
• Ellen would like to itemize her deductions this year.
• Ellen brings documents for the following expenses:
o $9,000 Hospital and doctor bills
o $500 Contributions to Health Savings Account (HSA)
o $3,600 State withholding (higher than Ellen's calculated state sales tax deduction)
o $300 Personal property taxes based on the value of the vehicle
o $400 Friend’s personal GoFundMe campaign
o $275 Cash contributions to the Red Cross
o $200 Fair market value of clothing in good condition donated to the Salvation Army (Ellen purchased the clothing for $900)
o $7,300 Mortgage interest
o $2,300 Real estate tax
o $150 Homeowners association fees
o $3,000 Gambling losses

Ellen Black – Test Question
11. Ellen can claim the $400 she donated to her friend's personal GoFundMe campaign as a deduction on her Schedule A.
a. True
b. False Answer

Ellen Black – Test Question 11 Explanation:

Money donated to personal GoFundMe campaign are not deductible.
12. What amount of gambling losses is Ellen eligible to claim as a deduction on her Schedule A?
a. $0
b. $1,000
c. $2,000 Answer
d. $3,000

Ellen Black – Test Question 12 Explanation:

Ellen is eligible to claim $2,000 in gambling losses as a deduction on her Schedule A. You may deduct gambling losses only if you itemize your deductions on Schedule A (Form 1040) and kept a record of your winnings and losses.

The amount of losses you deduct can't be more than the amount of gambling income you reported on your return.

Ellen Black – Retest Questions;
11. If Ellen chooses to itemize, which of the following is she eligible to claim as a deduction on Schedule A?
a. $400 GoFundMe donation
b. $500 Contributions to Health Savings Account (HSA)
c. $150 Homeowner’s Association fees
d. $300 Personal property taxes based on the value of her vehicle Answer

Ellen Black – Retest Question 11 Explanation:
Nondeductible payments; You can’t deduct any of the following items:
$150 Homeowner’s Association fees
$400 GoFundMe donation

What are the benefits of an HSA? HSA contributions are not deductible on Schedule A.

You may enjoy several benefits from having an HSA.

You can claim a tax deduction for contributions you, or someone other than your employer, make to your HSA even if you don’t itemize your deductions on Schedule A (Form 1040).

12. Ellen is eligible to claim $3,000 in gambling losses as a deduction on her Schedule A.
a. True b. False Answer

Ellen Black – Retest Question 12 Explanation:

Ellen is eligible to claim $2,000 in gambling losses as a deduction on her Schedule A.

You may deduct gambling losses only if you itemize your deductions on Schedule A (Form 1040) and kept a record of your winnings and losses.

The amount of losses you deduct can't be more than the amount of gambling income you reported on your return.

David Stone Interview Notes: • David Stone is 28 years old and single. He provides all of his own support.
• David works at a gas statopm and earned $18,500 in wages.
• David took two management courses at a community college to improve his job skills. He was less than a half time student. He wants to know if that qualifies for any educational tax benefit.
• David took an early distribution from his IRA of $2,000 for tuition and $500 for emergency repairs of his air conditioning system. This is the first time he has taken a distribution from his IRA. • David is a U.S. citizen and lived in the U.S. for the entire year. He has a valid Social Security number.
David Stone – Test Questions: 13. David is eligible to claim the American Opportunity Credit on his 2024 tax return. a. True
b. False ANSWER
David Stone – Test Question 13 Explanation:
Reference:
IRS Publication 970, Tax Benefits for Education.
To be eligible for Lifetime Learning Credit (LLC), the student must:

Felony drug conviction doesn’t make the student ineligible for Lifetime Learning Credit.

Information can be found in Publication 970, Tax Benefits for Education.

Be enrolled or taking courses at an eligible educational institution.

Be taking higher education course or courses to get a degree or other recognized education credential or to get or improve job skills.

Be enrolled for at least one academic period beginning in the tax year.

You can't claim the credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint re-turn).

14. Which of the following is not a requirement for John to claim the earned income credit with no qualifying children in 2022?
a. John must have a Social Security number valid for employment.
b. John must be a full time student. Answer
c. John must not be the dependent of another taxpayer.
d. John must have lived in the United States more than half the year.

John Ward – Test Question 14 Explanation:

To be eligible for Lifetime Learning Credit (LLC), the student must:

Felony drug conviction doesn’t make the student ineligible for Lifetime Learning Credit.

Information can be found in Publication 970, Tax Benefits for Education.

Be enrolled or taking courses at an eligible educational institution.

Be taking higher education course or courses to get a degree or other recognized education credential or to get or improve job skills.

Be enrolled for at least one academic period beginning in the tax year.

You can't claim the credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint re-turn).

John Ward – Retest Questions;
13. Which of the following is a requirement for John to claim the lifetime learning credit in 2022?
a. John must be at least a half-time student.
b. John must be a degree candidate at an eligible educational institution.
c. John's modified adjusted gross income (MAGI) must be less than $90,000. Answer
d. John must have no felony drug convictions.

John Ward Retest Question 13 – Explanation:

Reference: Publication 970, Tax Benefits for Education. The lifetime learning credit is phased out if your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you file a joint return).
To be eligible for LLC, the student must: Be enrolled or taking courses at an eligible educational institution.
Be taking higher education course or courses to get a degree or other recognized education credential or to get or improve job skills. Be enrolled for at least one academic period* beginning in the tax year.

You can't claim the credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint re-turn).
14. John is eligible to claim the earned income credit on his 2022 tax return.
a. True Answer b. False

John Ward Retest Question 14 – Explanation:

Must be at least age 25 but under age 65 as of December 31 with earned income below $21,430 for those filing single and $27,380 for spouses filing a joint return.

The maximum credit for taxpayers with no qualifying children is $1,502.

Directions:
Using the tax software, complete the tax return, including Form 1040 and all appropriate forms, schedules, or worksheets. Answer the questions following the scenario.

When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice.

Robert and Emily Lincoln – Interview Notes:
• Robert is a 6th grade teacher at a public school. Robert and Emily are married and choose to file Married Filing Jointly on their 2022 tax return.
• Robert worked a total of 1,340 hours in 2022. During the school year, he spent $733 on unreimbursed classroom expenses.
• Emily retired in 2019 and began receiving her pension on November 1st of that year. She explains that this is a joint and survivor annuity. She has already recovered $1,216 of the cost of the plan.
• Robert settled with his credit card company on an outstanding bill and brought the Form 1099-C to the site. They aren’t sure how it will impact their tax return for tax year 2022. The Lincolns determined that they were solvent as of the date of the canceled debt.
• Emily won $4,414 gambling at a casino and had additional lottery winnings of $175. Emily has documented casino losses of $1,260.
• Their daughter, Safari, is in her second year of college pursuing a bachelor’s degree in Veterinary Medicine at a qualified educational institution. She received a scholarship and the terms require that it be used to pay tuition. Box 2 was not filled in and Box 7 was not checked on her Form 1098-T for the previous tax year. The Lincolns provided Form 1098-T and an account statement from the college that included additional expenses. The Lincolns paid $865 for books and equipment required for Safari's courses. This information is also included on the college statement of account. The Lincolns claimed the American Opportunity Credit last year for the first time.
• Safari does not have a felony drug conviction.
• They are all U.S. citizens with valid Social Security numbers.

2022 LINCOLN FEDERAL RETURN CUSTOMER’S DOCUMENTS:

2022 LINCOLN FEDERAL RETURN LIST OF IRS FORMS:

2022 LINCOLN FEDERAL RETURN QUICK SUMMARY – IRS:
FILING STATUS: 2 (MFJ)
TOTAL INCOME: 75908
ADJUSTMENTS TO INCOME: 300
ADJUSTED GROSS INCOME: 75608
STANDARD DEDUCTION: 27300
TAXABLE INCOME: 48308
TAX: 5394
TOTAL CREDITS: 1893 (500 OTHER DEPENDENT + 1393 EDUCATION)
TOTAL TAX: 3501
TOTAL PAYMENTS: 7963 (7035 TAX WITHHELD + 928 REFUNDABLE)
REFUND: 4468

Advanced Scenario 7: Robert and Emily Lincoln – Test Questions;
15. What is the taxable portion of Emily's pension from Maple Enterprises using the simplified method?
a. $0
b. $17,415
c. $18,789 Answer
d. $19,350
Robert and Emily Lincoln – Question 15 Explanation:

• Robert Lincoln 2022 – 1961 = 61
• Emily Lincoln 2022 – 1954 = 68
• 61 + 68 = 129 from Table 2 121 – 130 = 310
Partially Taxable Pensions and Annuities:
• Simplified Method: You must use the Simplified Method if the payments are from a qualified employee plan or a qualified employee annuity.
• Enter the total pension or annuity payments from Form 1099-R, box 1 on line 5a. If your Form 1099-R doesn't show the taxable amount, you must use the Simplified Method to figure the taxable part to enter on line 5b.
• If your Form 1099-R shows a taxable amount, you can report that amount on line 5b. But you may be able to report a lower taxable amount by using the Simplified Method
. • If you must use the Simplified Method, complete the Simplified Method Worksheet in 2022 1040 instructions to figure the taxable part of your pension or annuity.
• You can ask the IRS to figure the taxable part for you for a $1,000 fee. For details, see Pub. 939.
16. All of Emily's social security income is taxable.
a. True b. False Answer
Robert and Emily Lincoln – Question 16 Explanation:
IRS Notice 703: You were married, would file jointly, and line E above is more than $32,000. 21203 / 2 = 10602 plus total income 33657 = 44259 minus 32000, then some of the social security income is taxable. Up to 85% of a taxpayer's benefits may be taxable if they are: Married filing jointly with more than $44,000 income. 21203 x .85 = 18023 Answer.

17. What is the total amount of other income reported on the Lincoln's Form 1040, Schedule 1?
a. $5,439 Answer
b. $5,264
c. $4,589
d. $850
Robert and Emily Lincoln – Question 17 Explanation;
Cancellation of credit card debt is included in the Income – Other Income lesson of Publication 4491 2022 RETURNS.
Form 1099-C: If a taxpayer receives Form 1099-C for canceled credit card debt and was solvent (assets greater than liabilities) immediately before the debt was canceled, all the canceled debt will be included on the tax return as other income.
Examples of "Other Income" on Schedule 1:

Gambling winnings, 4,414 + 175 + 850 = 5,439 Answer

Lotteries, 175

Nonbusiness credit card debt cancellation, 850

18. Robert is eligible to deduct qualified educator expenses in the amount of $____________. 300 Answer.
Robert and Emily Lincoln – Question 18 Explanation:
An eligible educator is a kindergarten through grade 12 teacher, who worked in a school for at least 900 hours during a school year. If you were an eligible educator in 2022, you can deduct qualified expenses up to $300 you paid in 2022 in the Adjustments to Income section of Schedule 1 (Form 1040), line 11.
19. What is the Lincoln's standard deduction on their 2022 tax return?
a. $28,700
b. $27,300 Answer
c. $25,900
d. $19,400
Robert and Emily Lincoln – Question 19 Explanation:
IF your filing status is Married filing jointly AND the number of boxes checked is 1 THEN your standard deduction is $27,300 Anawer.
20. Which is not a qualifying expense for the American opportunity credit?
a. Parking pass Answer
b. Required course related books
c. Tuition
d. Required course related equipment
Robert and Emily Lincoln – Question 20 Explanation:
Expenses eligible for the American Opportunity Credit: Qualified education expenses include amounts spent for tuition and materials for course enrollment. This includes books, supplies, and equipment needed for a course of study. Parking pass is not a qualifying expense for the American Opportunity Credit.
21. Which of the following credits are the Lincolns eligible to claim on their tax return?
a. Child tax credit
b. Credit for other dependents
c. American opportunity credit
d. Only b and c Answer
Lincoln Advanced Test – Question 21 Explanation:
To qualify for the Credit for Other Dependents: There is a $500 credit for other dependents who do not qualify for the $2,000 child tax credit. The dependent must be a U.S citizen, U.S. national, or resident of the U.S. The dependent must have a valid identification number (ATIN, ITIN, or SSN).
To qualify for the American Opportunity Credit: To be eligible for AOTC, the student must be pursuing a degree or other recognized education credential. Be enrolled at least half time for at least one academic period beginning in the tax year. Not have finished the first four years of higher education at the beginning of the tax year.
22. What is the Lincoln’s total federal income tax withholding? $__________. 7035 Answer
Robert and Emily Lincoln – Question 22 Explanation:
3,000 W-2 + 2,100 SSA-1099 + 1,935 1099-R = $7,035 Answer.

Advanced Scenario 7: Robert and Emily Lincoln – Retest Questions;
15. The taxable portion of Emily's pension from Maple Enterprises using the simplified method is $19,350.
a. True b. False Answer
16. The taxable amount of Emily's social security income is:
a. $21,203
b. $18,023 Answer
c. $17,062
d. $0
17. The total amount of other income reported on the Lincoln's Form 1040, Schedule 1 is $850.
a. True b. False Answer
18. What is the amount Robert is eligible to claim as qualified educator expenses on Form 1040, Schedule 1?
a. $0
b. $250
c. $300 Answer
d. $733
19. The Lincoln's standard deduction on their Form 1040 for tax year 2022 is $25,900.
a. True b. False Answer
20. Which of the following expenses qualify for the American opportunity credit?
a. Required course related books and equipment
b. Tuition
c. Parking pass
d. Both a and b Answer
21. The Lincolns can claim the credit for other dependents for their daughter Safari.
a. True Answer
b. False
22. How much federal income tax withholding is reported on the Lincolns' Form 1040?
a. $1,935
b. $3,000
c. $4,935
d. $7,035 Answer

Joanne Oak – Interview Notes:

2022 SCENARIO 8 JOANNE OAK FEDERAL RETURN CUSTOMER'S DOCUMENTS:

alt="2022 OAK FORM 1099-T TUITION STATEMENT"

2022 SCENARIO 8 JOANNE OAK FEDERAL RETURN LIST OF FORMS;

Form 8879 document:
Form 8879 is the declaration document and signature authorization for an e-filed return filed by an electronic return originator (ERO).
Complete this form when:
• The Practitioner PIN method is used.
• The taxpayer authorizes the ERO to enter or generate the taxpayer’s personal identification number (PIN) on his/her e-filed individual income tax return.

alt="2022 OAK FORM 1040 LINE 16 TAX WORKSHEET QUALIFIED DIVIDENTS AND CAPITAL GAIN TAX"

"

IRS Determining Your Qualified Business Income Instructions for Form 8995:

IRS Qualified business income for Form 8995 equals to Net Profit Schedule C Line 31 = 6457 minus Deduction for one-half of Self-Employment Tax Schedule SE Line 13 = 456.
6457 - 456 = 6001 Enter on line 1(c) the net qualified business income or (loss) for the trade, business, or aggregation reported in the corresponding row.

2022 SCENARIO 8 OAK FEDERAL RETURN DETAILED SUMMARY WITH EXPLANATIONS:
FILING STATUS: 1 (SINGLE)
TOTAL INCOME: 48444
EXPLANATION: (FORM 1040 LINE 9 48444 = 36050 W-2 + 12 INTEREST + 225 DIVIDENTS + 2500 IRA + SCHEDULE C 6457 + SCHEDULE D 3200)
TOTAL ADJUSTMENTS TO INCOME: 2956
EXPLANATION: (FORM 1040 LINE 10 2956 = DEDUCTABLE SELF-EMPLOYMENT TAX SCHEDULE 1 LINE 15 456 + STUDENT LOAN INTEREST SCHEDULE 1 LINE 25 2500)
ADJUSTED GROSS INCOME (AGI): 45488
EXPLANATION: (FORM 1040 LINE 11 45488 = 48444 MINUS 2956)
STANDARD DEDUCTION: 12950
TAXABLE INCOME: 31332
EXPLANATION: (FORM 1040 LINE 15 31332 = 45488 (AGI) - 12950 - 1206 QUALIFIED BUSINESS DEDUCTION LINE 13 FORM 1040)
TAX: 3242
EXPLANATION: (CALCULATED USING QUALIFIED DIVIDENTS AND CAPITAL GAIN TAX WORKSHEET—Line 16)
CREDITS: 480
EXPLANATION: (FORM 1040 LINE 20 FROM EDUCATION CREDIT SCHEDULE 3 LINE 3)
OTHER TAXES: 1162
EXPLANATION: (1162 FORM 1040 LINE 23 OTHER TAXES FROM SCHEDULE 2 LINE 21 = SCHEDULE 2 LINE 4 SELF-EMPLOYMENT TAX 912 + SCHEDULE 2 LINE 8 ADDITIONAL TAX ON IRA 250))
TOTAL TAX: 3924
EXPLONATION: (FORM 1040 LINE 24 3924 = TAX 3242 - 480 FROM SCHEDULE 3 LINE 20 EDUCATION CREDIT + 1162 OTHR TAX FROM SCHEDULE 2 LINE 23)
TOTAL PAYMENTS: 3050
EXPLANATION: (3050 = 2800 FORM W-2 + 250 FORM 1099-R)
AMOUNT DUE: 874
EXPLANATION: (874 = TOTAL TAX 3924 FORM 1040 LINE 24 - TOTAL PAYMENTS 3050 FORM 1040 LINE 33)

2022 SCENARIO 8 OAK FEDERAL RETURN SUMMARY

FILING STATUS: 1 (SINGLE)

TOTAL INCOME: 48444

TOTAL ADJUSTMENTS TO INCOME: 2956

ADJUSTED GROSS INCOME: 45488

STANDARD DEDUCTION: 12950

TAXABLE INCOME: 31332

TAX: 3242

CREDITS: 480

OTHER TAXES: 1162

TOTAL TAX: 3924

TOTAL PAYMENTS: 3050

AMOUNT DUE: 874

Advanced Scenario 8: Joanne Oak – Test Questions;
23. What is the net long term capital gain reported on Joanne's Schedule D?
a. $2,450 Answer
b. $2,100
c. $1,750
d. $350
Joanne Oak – Question 23 Explanation:
$2,100 + $350 = $2,450

Capital Gain Distributions Line 13: Enter on Schedule D, line 13, the total capital gain distributions paid to you during the year, regardless of how long you held your investment. This amount is shown in box 2a of Form 1099-DIV below.

Capital Gain Distributions Line 18: If there is an amount in box 2d of the Form 1099-DIV, include that amount on line 4 of the 28% Rate Gain Worksheet in these instructions if you complete line 18 of Schedule D.

24. Which of the following can be claimed as a business expense on Joanne's Schedule C?
a. Car washes
b. Tickets for illegal parking
c. Tolls Answer
d. Snacks and lunches
Joanne Oak – Question 24 Explanation:
Tolls: You can deduct the standard mileage rate, as well as business-related tolls and parking fees. Oct 6, 2022
Snacks and lunches: For 2021 and 2022 only, businesses can generally deduct the full cost of business-related food and beverages purchased from a restaurant. Otherwise, the limit is usually 50% of the cost of the meal. Jun 14, 2022

25. What is the amount Joanne can take as a student loan interest deduction on her Form 1040, Schedule 1? $__________________. 2500 Answer
Joanne Oak – Question 25 Explanation:
Student loan interest is interest you paid during the year on a qualified student loan. It includes both required and voluntarily pre-paid interest payments. You may deduct the lesser of $2,500 or the amount of interest you actually paid during the year.
26. How many miles can Joanne use to calculate her standard mileage deduction?
a. 1,500
b. 2,500 Answer
c. 4,000
d. 11,000
Joanne Oak – Question 26 Explanation:
If you take the standard mileage rate:
• Multiply the business standard mileage rate from January 1, 2022, to June 30, 2022, by 58.5 cents a mile;
• Multiply the business standard mileage rate from July 1, 2022, to December 31, 2022, by 62.5 cents a mile; and
• Add to this amount your parking fees and tolls; and
• Enter the total on line 9.
27. What is the amount of Joanne's lifetime learning credit? $_______________. 480 Answer.
Joanne Oak – Question 27 Explanation:
How to figure the amount of Lifetime Learning Credit and Qualified Expenses:
Tuition and required enrollment fees (including amounts required to be paid to the institution for course-related books, supplies, and equipment). The amount of the credit is 20 percent of the first $10,000 of qualified education expenses or a maximum of $2,000 per return. Lifetime learning credit equals 20% of qualified education expenses. 2400 Tuition x .20 = 480 Answer.

28. Joanne will have to pay $________ 10 additional tax because she received the early distribution from her IRA.
Joanne Oak – Question 28 Explanation:
Joanne will be subject to the additional 10% tax if no exception applies. Because, Joanne used only a portion of the IRA distribution for the qualified higher education expenses, she has to pay additional $250 tax penalty for the IRA early distribution. Also, please note, there is an error, the $10 should have been $250.
29. How can Joanne prevent having a balance due next year?
a. She can increase the withholding on her Form W-4.
b. She can make estimated tax payments.
c. She can use the IRS withholding calculator to estimate her withholding for next year.
d. All of the above Answer
Joanne Oak – Question 29 Explanation:
Having enough tax withheld or making quarterly estimated tax payments during the year can help Joanne avoid problems at tax time. Another way to pay taxes is to pay-as-you-go. This means that you need to pay most of your tax during the year, as you receive income, rather than paying at the end of the year.

Advanced Scenario 8: Joanne Oak – Retest Questions;
23. Joanne's net long-term capital gain reported on Schedule D is $_______. 2450 Answer.
(2100 + 350 = 2450).
24. Joanne cannot claim the $150 for illegal parking tickets as a business expense on Schedule C.
a. True Answer b. False
25. What is the amount Joanne can take as a student loan interest deduction on her Form 1040, Schedule 1?
a. $3,250
b. $2,500 Answer
c. $750
d. $0
26. How many miles can Joanne use to calculate her standard mileage deduction? ______________. 2500 Answr
27. Joanne meets the qualifications to claim the Lifetime Learning Credit.
a. True Answer b. False
28. What is Joanne's additional 10% tax on the early withdrawal from her IRA?
a. $0
b. $10Answer
c. $240
d. $250
29. Joanne can make estimated tax payments to avoid owing tax next year.
a. True Answer
b. False

Thomas Polk – Interview Notes:

2022 SCENARIO 9 THOMAS POLK – LIST OF TAXPAYER’S DOCUMENTS:
FORM W-2
FORM 1099-INT (INTEREST INCOME)
FORM 1095-A (HEALTH INSURANCE MARKETPLACE STATEMENT)
DOWNTOWN DAY CARE STATEMENT (CHILDCARE EXPENSES)

2022 SCENARIO 9 THOMAS POLK – LIST OF TAX RETURN FORMS:
FORM 8879 (E-FILE SIGNATURE AUTHORIZATION)
FORM 1040 (TAX RETURN)
SCHEDULE 1 (ADDITIONAL INCOME AND ADJUSTMENTS TO INCOME)
SCHEDULE 3 (ADDITIONAL CREDITS AND PAYMENTS)
SCHEDULE B (INTEREST AND DIVIDENTS INCOME)
FORM 2441 (CHILD CARE CREDIT)
FORM 2441 (CHILD CARE CREDIT) LINE 10 CREDIT LIMIT WORKSHEET
SCHEDULE EIC (EARNED INCOME CREDIT)
WORKSHEET A – 2022 EIC FORM 1040 – LINE 27
SCHEDULE 8812 (CHILD TAX CREDIT AND ADITIONAL CHILD TAX CREDIT)
SCHEDULE 8812 LINE 13 CREDIT LIMIT WORKSHEET
FORM 8880 (RETIREMENT SAVINGS CREDIT)
FORM 8962 (PREMIUM TAX CREDIT)
2022 SCENARIO 9 POLK – IRS RETURN: SUMMARY
FILING STATUS 4 (HEAD OF HOUSEHOLD)
INCOME 41130
ADJUSTMENTS TO INCOME 26
ADJUSTED GROSS INCOME AGI 41104
DEDUCTIONS 19400
TAXABLE INCOME 21704
TAX 2314 (FROM IRS 2022 TAX TABLE)
CREDITS 2314
PAYMENTS 3264
REFUND 3264

Advanced Scenario 9: Thomas Polk – Test Questions;
30. What is Thomas's most advantageous filing status?
a. Single
b. Married Filing Separately
c. Head of Household Answer
d. Qualifying Surviving Spouse (QSS)
Thomas Polk – Question 30 Explanation:
Surviving spouses who have an eligible child may be able to use the Qualifying Surviving Spouse status in the two tax years following the year of the spouse’s death. Thomas was widowed in 2019. 2022 is the third year after 2019 therefore Thomas’s most advantageous filing status is Head of Household.
31. Thomas's adjusted gross income on his Form 1040 is $__________. 41104 Answer.
Thomas Polk – Question 31 Explanation:
On 2022 tax return, your AGI is on line 11 of the Form 1040. And it equals to line 10 Adjustments to Income from Schedule 1, line 26 subtracted from Total Income on line 9 of your Form 1040.
32. Thomas can claim the following credits on his tax return.
a. Child Tax Credit
b. Child and Dependent Care Credit
c. Premium Tax Credit
d. All of the above Answer
Thomas Polk – Question 32 Explanation:
33. Thomas's Retirement Savings Contributions Credit on Form 8880 is $___________. 100 Answer.
Thomas Polk – Question 33 Explanation:
Form W-2 Box 12a D is for 401(k) contributions You may be able to claim the Saver's Credit, Form 1040 Schedule 3, line 4. Line 11 Adjusted Gross Income (AGI).
34. The total amount of Thomas's advanced payment of premium tax credit for 2022 is $___________. 4656 Answer.
Thomas Polk – Question 34 Explanation:
35. Thomas's child and dependent care credit from Form 2441 is reported as a non-refundable credit on Form 1040, Schedule 3.
a. True Anawer b. False
Thomas Polk – Question 35 Explanation:

For 2022, the credit for child and dependent care expenses is nonrefundable and you may claim the credit on qualifying employment-related expenses of up to $3,000 if you had one qualifying person, or $6,000 if you had two or more qualifying persons.

The maximum credit is 35% of your employment-related expenses if your adjusted gross income is $15,000 or less. Reference: IRS Publication 503 2022 Child and Dependent Care Expenses.

30. Thomas is eligible to claim the Qualifying Widower filing status.
a. True b. False Answer
31. What is Thomas's adjusted gross income on his Form 1040?
a. $41,130
b. $41,104 Answer
c. $41,000
d. $21,704
32. Thomas is eligible to claim the credit for other dependents in 2022.
a. True b. False Answer
33. Thomas qualifies to claim a retirement savings contribution credit.
a. True Anawer b. False
34. What is the total amount of advanced payment of premium tax credit that Thomas received in 2022?
a. $7,224
b. $5,352
c. $4,656 Answer
d. $388
35. Thomas's child and dependent care credit is refundable in 2022.
a. True b. False Answer

The first five questions are about how to calculate the allowable portion of standard deductions to U.S. income. Use your VITA Puerto Rico Resource Guide Publication 4696PR and Publication 1321 to answer the questions.
1. Lauren was a resident of Puerto Rico during 2022. She is single and under 65 years of age. She works as a U.S. government employee and her salary was $34,000. She also received income of $6,000 from a part-time job in Puerto Rico not subject to U.S. tax. What is the allowable portion of the standard deduction that Lauren can claim?
a. $11,008 ANSWER
2. German and Elena were residents of Puerto Rico in 2022. They are age 72 and file a joint return. German is retired from the U.S. Postal Service and Elena is retired from the U.S. Veterans Affairs. Their taxable pensions were $28,000 and $42,000, respectively What is German and Elena’s standard deduction?
d. $28,700 ANSWER
3. Marco is 40 years old, qualifies to file Head of Household, and a resident of Puerto Rico during 2022. He informed you that he received the following sources of income: $12,500 for a job he performed in the state of Florida; $23,200 received from the federal government for services performed in Puerto Rico. He also received $6,300 from a part-time job in Puerto Rico that is exempt from federal income tax. What is the allowable portion of Marco’s standard deduction?
b. $16,490 ANSWER
Calculation: $12,500 and $23,200 and $6,300 35700/42000=0.85
Head of household under 65 enter $19,400x.85=$16490
4. Camilo is a bona fide resident of Puerto Rico, who received Social Security benefits and pension income from the University of Puerto Rico. Does Camilo have U.S. source income?
a. Yes, he has U.S. source income. ANSWER
5. Paloma is single and received unemployment benefits from the Puerto Rico Department of Labor reported on a Form 1099-G. What is the factor determining source of income for unemployment?
c. Unemployment compensation is generally considered sourced where the taxpayer performed the underlying services. ANSWER

6. What is the amount of the Additional Child Tax credit on line 3, Part II, in Form 1040-PR?
b. $3,000 ANSWER
7. What filing status can Kenya use?
a. Head of Household ANSWER
8. Kenya can file Form 1040-PR or Form 1040-SS to claim the Additional Child Tax credit.
a. True ANSWER
9. The IRS issues an Identity Protection Personal Identification Number (IP PIN) to protect and confirm taxpayer identity when submitting a tax return. Should the IP PIN be included on the Form 1040SS or Form 1040PR?
a. Yes ANSWER
10. Kenya must have earned income to be able to claim the Additional Child Tax Credit.
a. True ANSWER

11. What filing status can Antoni and Marta claim on their return?
b. Married Filing Jointly ANSWER
12. How many dependents are eligible for the Additional Child Tax Credit (ACTC)?
b. 3 ANSWER
13. How much is the Additional Child Tax Credit that Antoni and Marta are entitled to receive?
b. $3,213 ANSWER
14. Which of the following income must be reported on Form 1040 PR or Form 1040 SS, Part II, Line 1 to calculate the modified adjusted gross income?
a. Wages and Unemployment
b. Taxable Pension and Annuities
c. Taxable Social Securities Benefits
d. All of the above. ANSWER
15. Which form should be completed by Antoni and Marta to claim the Additional Child Tax Credit?
c. Form 1040-PR or Form 1040-SS ANSWER

1. The first five questions are for figuring the allowable portion of itemized deductions to U.S. income;
2. And for calculating the source of pension income for service performed in the U.S.;
3. And for determining the taxable portion of Social Security benefits.
4. Use your Publication 4696(PR) VITA Puerto Rico Resource Guide and Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return (Form 1040 or Form 1040-SR) to answer the questions.

2.1 Adan and Eva are both under age 65 and bona fide residents of Puerto Rico who file a joint return. Adan had self-employed gross income of $30,000 from his business in Puerto Rico. Eva works for the federal government and her salary was $45,000. Before calculating the allowable portion of itemized deductions, they had the following eligible itemized deductions:
* Home mortgage interest: $10,600
* Real estate taxes: $1,400
* Charitable contributions: $750

1.) Total amount of itemized deductions: 10600+1400+750=$12,750
2.) Itemized deduction calculation: 45000/75000=0.6x12750=$7,650
3.) Standard deduction calculation: 45000/75000=0.6x25900=$15,540

What is the amount of calculated allowable itemized deductions that can be claimed?
a. $0
b. $5,100
c. $7,650 ANSWER
d. $12,750

Because your minimum income level at which you must file a tax return is based on the standard deduction for your filing status, you must first use the following worksheet to calculate your Modified Standard Deduction to determine if you have to file a U.S. income tax return:

Line 1: Married filing jointly both under 65 for 2022 enter $25,900 for STANDARD DEDUCTION.
Line 2:
a) Gross income subject to U.S. tax = $45,000.
b) Total gross income from all sources (including exempt P.R. Income) $30,000 + $45,000.
c) Divide 2a by 2b: $45,000 / $75,000 = 0.6.
d) MODIFIED STANDARD DEDUCTION and filing requirement:
Multiply STANDARD DEDUCTION line 1 by 2c: $25,900 x 0.6 = $15,540 and this is your Modified Standard Deduction.
Conclusion: Itemized deductions = $7,650 and less than $15,540 Modified Standard Deduction.

2.2 Calculate the allowable standard deduction for Adan and Eva (see exercise 2.1 above). Based on these calculations, the allowable standard deduction is higher than the allowable itemized deductions.
a. True ANSWER
b. False

2.3 Franklin is a single taxpayer, 63 years old, and a bona fide resident of Puerto Rico with no dependents. Franklin received a Form SSA-1099, Social Security benefits, showing $26,700 in box 3. He did not receive any other income. Use Publication 4696 (PR) TAB H - Social Security Benefits as your reference materials.
Is any part of his Social Security benefits subject to U.S. income tax?
a. Yes
b. No ANSWER

• $12,950 STANDERD DEDUCTION Single under 65.
• $26,700 SS SOCIAL SECURITY BENEFIT x 0.50 = $13,350.
• If social security benefits are the taxpayer’s only source of income, than the benefits are not taxable.
• Reference IRS 2022 Publication 915 Social Security and Equivalent Railroad Retirement Benefits.

2.4 In 2022, Alex, 85 years old, resident of Puerto Rico, received $26,000 from his U.S. Civil Service pension. The benefits of this pension are attributed to a 25-year career with the federal government, in the state of New York. Which amount of Alex’s pension is eligible to claim a Foreign Tax Credit on Form 1040?
a. $0 ANSWER
b. $15,600
c. $20,000
d. $26,000

Formula to Calculate the Foreign Tax on U.S. Pension:
• IRS, Which amount of U.S. Civil Service pension as a U.S. possession can be claimed as Foreign Tax Credit on Form 1040 as a Puerto Rico resident.
• For pension, unemployment, and disability fund payments and a foreign tax imposed on an individual to pay for retirement, old-age, No deduction or credit is allowed.
• For reference and more information, see IRS 2022 Publication 514 Foreign Tax Credit for Individuals.

2.5 Santiago is single, 70 years old and received Form SSA-1099 for 2022, which shows benefits of $19,000 in box 5. He also received the following income during 2022:
* Taxable pension from the University of Puerto Rico of $37,000.
* Salary of $5,000 from a company in Puerto Rico.
* Taxable IRA distribution of $4,000 from a bank in Puerto Rico.
Using Publication 915, Worksheet 1 and VITA/TCE Practice Lab https://vita. taxslayerpro.com/, what amount of his Social Security benefit is taxable to the United States?
a. $0
b. $16,150 ANSWER
c. $17,200
d. $19,000

Worksheet 1, Publication 915: Question 2.5 how to Figure Santiago’s Taxable Social Security Benefits. And $16,150 Proof.
You can also complete Worksheet 1 in Publication 915 2022, Page 16 shown below to see the proof for the ANSWER $16,150. Follow the Worksheet 1 for Santiago in question 2.5, how you can lower your taxable amount to $16,150. And so, figuring your taxable benefits using the Worksheet 1, pays for itself.

Note: If you're a bona fide resident of Puerto Rico, you'll be able to exclude income from Puerto Rican sources (a company in Puerto Rico) on your U.S. income tax return.

2022 LEVEL II PUERTO RICO TEST - SCENARIO 1: CATALINA RAVAL QUESTIONS;

CATALINA RAVAL DOCUMENTS:
• Completed Intake/Interview and Quality Review Sheet;
• Form CSA 1099-R;
• Form SSA-1099;

CATALINA RAVAL INTERVIEW NOTE:
• Catalina Raval is 70 and was born on January 2, 1952.
• Catalina’s SSN is 123-00-XXXX and her grandson Lucas Cruz’s SSN is 124-00- XXXX.
• Her grandson, Lucas, was born on July 23, 2007, has lived with her for the last three years and qualifies her to file as Head of Household.
• Catalina pays the total cost of keeping up a home for herself and her grandson.
• She does not want to contribute to the presidential election campaign.
• If a refund or balance is due, Catalina would like a direct deposit to or direct debit from her checking account 67890; routing number 021904512.
• Her address and SSN are correct and were validated during the interview.
• Catalina is retired from the Civil Service Retirement System. She has a single life annuity and began receiving retirement benefits on January 5, 2010. The pension is attributed to services performed in New York. Catalina moved to Puerto Rico in 2010.
• Catalina receives Social Security benefits.
• According to the Simplified Method, Catalina can recover $2,667 of the cost of her pension tax free annually.

Please complete Form 1040, Publication 915, Worksheet 1, and the child tax worksheet to answer the following questions. You are a volunteer at site S21014444.

2.6 After considering the cost recovery of tax free amount; what is the taxable portion of Catalina’s pension?
a. $0
b. $15,000
c. $32,033 ANSWER
d. $34,700

SOLUTION:
2022 Catalinal’s Form 1099-R Statement of Annuity Paid Box 1 Gross distribution is $34,700.
Taxable portion or Catalina’s pension is $34,700 minus per Worksheet A Simplified Method, Catalina can recover $2,667 tax free annually = $32,033 and the Answer.

Worksheet A. Simplified Method Worksheet for Catalina Raval to figure the taxable part of her pension:
Reference: 2022 Publication 575 Pension and Annuity Income.
TIP: Form 1099-R. If you received payments of a life annuity in 2022, the payer shows your total contributions to the plan in Box 9b. Total Employee Contributions $68,900.00, of your 2022 Form 1099-R.

Annuity starting date defined: Your annuity starting date is the first day of the first period for which you received a payment. Catalina Raval, she has single life annuity started on January 5, 2010.
Therefore, 70 minus 12 years is 58 years old when Catalina started to receive retirement benefits. And from Table 1 58-60 the number 310 is the number to enter on line 3.

Simplified Method Worksheet—Lines 5a and 5b;

2.7 Can Catalina claim a foreign tax credit for the taxes paid to Puerto Rico on her pension attributed to services she performed in New York?
a. Yes
b. No ANSWER

2.8 What is the amount of Catalina’s standard deduction?
a. $4,000
b. $18,650
c. $19,400
d. $21,150 ANSWER

2.9 Is Catalina entitled to claim the Additional Child Tax Credit?
a. Yes
b. No ANSWER

2.10 The taxable amount of Catalina’s Social Security benefit (from the Publication 915 worksheet) is $9,470.80
a. Yes ANSWER
b. No

2.10 Catalina Raval Social Security $9,470.80 Taxable Benefit Proof using Publication 915 Worksheet 1.

CATALINA RAVAL 2022 Tax Return:

Important Note for 2.9 Question: The amount on line 12 is 2000 and no more than the amount on line 14 which is also 2000, and therefore you are not able to take the additional child tax credit on line 28 of the Form 1040-SR Payments section.

2.9 Question Answer Proof:
Catalina cannot claim the Additional Child Tax Credit.

2022 LEVEL II PUERTO RICO TEST - SCENARIO 2: MARTIN BESOS AND MARINA RAMBLA QUESTIONS;
TAXPAYER DOCUMENTS:
* Completed Interview and Quality Review Sheet;
* Forms W-2 for Martin Besos;

* Forms W-2 for Marina Rambla;
INTERVIEW NOTES:
* Martin Besos and Marina Rambla are married, filing a joint return, and have two dependent children under the age of 17.
* Marina’s mother, Carolina Rambla, lives with them. She is permanently and totally disabled. Carolina received Social Security benefits that are not taxable and were not used for her support.
* The children qualify for claiming both the non refundable and refundable child tax credit.
* The Social Security number for Martin is 134-00-1234 (date of birth: 09/23/1972) and for Marina is 135-00-1234 (date of birth: 01/25/1970).
* They have a daughter, Crystal (date of birth: 05/13/2012; SSN: 136-00-1234), and a son, Louis (date of birth: 02/15/2014; SSN: 137-00-1234). Carolina Rambla’s SSN is 138-00-1234 (date of birth: 03/30/1948).
* They do not itemize deductions.
* The Puerto Rico tax liability for 2022 is $4,100.
* Martin and Marina provided the entire cost of maintaining the household and all the support for their children and for Carolina.
* They have contributions to a retirement plan (401k), use Form 8880 to determine if they are elegible for the Saver’s credit.
* If a refund or balance is due, Martin and Marina would like a direct deposit to or direct debit from their checking account 53890; routing number 067901234.

2022 LEVEL 2 PUERTO RICO Test - Scenario 2: MARTIN BESOS AND MARINA RAMBLA QUESTIONS:
Complete the Form 1040 and schedules. Based on the information provided by Martin and Marina answer the following questions. You are a volunteer at site S21014444.

2.11 Martin and Marina’s total income shown on line 1 of Form 1040 is:
a. $0
b. $76,912 ANSWER
c. $78,859
d. $80,251

2.12 Martin and Marina are eligible to claim which of the following non-refundable credits on their 2022 tax return?
a. Other Dependent Credit
b. Foreign tax credit
c. Child Tax Credit
d. All of the above ANSWER
IRS – Foreign Tax Credit is not eligible on U.S. Source Income, Important Note:
2.12 Error: Question 2.12 b. Foreign tax credit not eligible for Foreign Tax Credit.

And here is the Proof:
IRS, can you claim Foreign Tax Credit on U.S. Source Income?
Important Note:
The foreign tax credit can only reduce U.S. taxes on foreign source income. The foreign tax credit cannot reduce U.S. taxes on U.S. source income.
IRS Reference: Publication 514 2022 Foreign Tax Credit for Individuals – IRS.
IRS, how to Claim the Foreign Tax Credit?
If you paid or accrued foreign taxes to a foreign country or Puerto Rico, U.S. possession and are subject to U.S. tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes.
Foreign Tax taken as a deduction: Deduct foreign taxes on Schedule A (Form 1040), Itemized Deductions.
Foreign Tax taken as a credit: You can file Form 1116. Foreign income taxes reduce your U.S. tax liability. In most cases, it is to your advantage to take foreign income taxes as a tax credit by filing Form 1116.

IRS, what is Puerto Rico Foreign Tax Credit?
Puerto Rico foreign tax credit allows a taxpayer to take a tax credit for taxes paid to a foreign government in Puerto Rico on foreign source income in Puerto Rico that is also subject to U.S. tax.

For the foreign tax credit purposes, taxes paid to U.S. Possessions are considered foreign taxes. For the purpose of the foreign tax credit, the U.S. possessions include Puerto Rico.

IRS, how Puerto Rico qualifies for the Foreign Earned Income for the Foreign Tax Credit?
The source of your earned income is the place (Puerto Rico) where you performed the services for which you received the income. Foreign Earned Income is the income you received for performing personal services in a foreign country (Puerto Rico).

Puerto Rico Bone Fide Residents Guide How to File Your IRS Form 1116?
Publication 514 Foreign Tax Credit for Individuals, for more information on what foreign taxes qualify for the foreign tax credit.
Publication 570 Tax Guide for Individuals with Income from U.S. Possessions Taxes on income from Puerto Rico exempt from U.S. tax.

What is Puerto Rico the U.S. Territory also called U.S. Possession?
You may need to file Form 8898, Statement for Individuals Who Begin or End Bona Fide Residence of Puerto Rico the U.S. Territory also called U.S. Possession, if you became or ended to be a Bona Fide resident of Puerto Rico.

2.13 What is the amount of Foreign Taxes that should be entered on line 8 in Form 1116?
a. $0
b. $2,750
c. $3,259
d. $4,100 ANSWER

IRS, is income earned from U.S. source and taxed by both U.S. and Puerto Rico eligible for Foreign Tax Credit?
2.13 Error: 2.13 d. What is the amount of Foreign Taxes that should be entered on line 8 in Form 1116?

Important Note: IRS – Foreign tax credit is not eligible on U.S. Source Income for Foreign Tax Credit.

U.S. Possessions (Puerto Rico):
For the Foreign Tax Credit purposes, all qualified taxes paid to U.S. possessions (Puerto Rico) are considered foreign taxes. For this purpose, U.S. possessions include Puerto Rico.
You File Joint Return:
If you file a joint return, you can claim the credit based on the total of any foreign income tax paid or accrued by you and your spouse.

2.14 Which of the following items are included in the total payments on Martin and Marina’s tax return?
a. Federal income tax withheld from Form W-2
b. Additional child tax credit
c. Child Tax Credit
d. Both a and b ANSWER
2.14 Error: Question 2.14 b. Additional child tax credit is not included in the Total Payments on Martin and Marina’s tax return.
2.15 What is the taxable income reported on Form 1040?
a. $0
b. $51,012 ANSWER
c. $52,959
d. $72,958

2022 PR LEVEL 2 W-2 MARTIN BESOS
2022 PR LEVEL 2 W-2 MARINA RAMBLA
Martin Besos and Marina Rambla 2022 Tax Return:

Filing an Extension Using Practice Lab TaxSlayer Pro Software – Form 4868 Application for Extension.

How To File Your Extension Form 4868 in 3 Simple Steps – Instructions For Using Free Tax Software Practice Lab – TaxSlayer Pro:
Application for Extension for Joanne Oak:
In Practice Lab - TaxSlayer Pro Step-by-Step:

IRS Form 4868 - Application for Extension for Joanne Oak:
• IRS Form 4868 – Application for Extension for Joanne Oak is the application for an automatic extension of time to file your individual income tax return.
• You may request up to an additional 6 months to file your U.S. individual income tax return. If you file the Form 4868 electronically, be sure to have a copy of your prior year's return;
– You'll be asked to provide your prior year's adjusted gross income (AGI) amount for verification purposes. On your 2021 tax return, your AGI is on line 11 of the IRS Form 1040.
• Once you file, you'll receive an electronic acknowledgement that the IRS has accepted your filing. Keep this for your records.
File an extension in a three simple steps:
1. Enter your information:
1a) Fill out the required information for your total Tax Liability.
1b) Your total amount already paid for your Current Tax Year.
1c) And the amount you’re paying to the IRS with your Extension.

1a. Tax Liability:
• Use your current tax liability amount. This is your total tax liability for the tax year.

1b. Amounts previously paid for current tax year:
• This is any amount of taxes you have already paid for the tax year (such as estimated quarterly tax payments or any tax withholdings).

1c. Amount Paid with Extension:
This is the amount you are going to pay to the IRS with your extension. Note: This amount is only for your federal taxes due.

2. You have three options to pay your tax amount due to the IRS.

2a) Pay with Electronic withdrawal from your checking account:
• Enter the amount you would like to pay, check the box indicating that you are paying your balance due electronically.
• You will then enter your banking information, the date you would like the transaction to take place and re-enter the amount to pay for confirmation.
• When you submit your extension, the withdrawal information will be sent to the bank.

2b) Pay with Debit or Credit Card:
• If you do not wish to use your bank account, you can go to the IRS website and pay by debit or credit card.
• You can also pay by phone using the electronic federal tax payment system.
• Check IRS.gov/payments (make a payment) for more information.

2c) Mail in your payment with your Extension Form 4868:
• You can print your Extension Form 4868 and mail it with your payment by check or money order.
• Don’t send cash. Make your check or money order payable to 'United States Treasury'.

Explanation:
• Total Tax Liability is $3924 = $3050 + $874;
• Totaling the amount paid for current tax year and that is Total Payments on the IRS Form 1040 Line 33 and that equals to $3050.
• And the amount paid with the IRS Form 4868 that equals to $874.

3. E-file your extension:
• Start by selecting e-File from the navigation bar. You will then be given the option to file your return (Form 1040 and supporting schedules).
• Or to file your Extension (Form 4868).
• Complete the extension e-File process.

Automatic 60 Day Extension to File:
• Taxpayers whose main home is located in a federal disaster area are now automatically provided an extension of time to file returns abd pay taxes.
• Extension of time to file begins on the first date specified in a federal disaster declaration and ending 60 days after the last date specified in that federal disaster declaration.
• Impacted taxpayers no longer need to wait for the IRS to announce postponed deadlines.
• This automatic relief applies to federal disaster declarations issued after December 20, 2019.

2022 SCENARIO 8 OAK FEDERAL RETURN	SUMMARY
FILING STATUS:	1 (SINGLE)
TOTAL INCOME:	48444
TOTAL ADJUSTMENTS TO INCOME:	2956
ADJUSTED GROSS INCOME:	45488
STANDARD DEDUCTION:	12950
TAXABLE INCOME:	31332
TAX:	3242
CREDITS:	480
OTHER TAXES:	1162
TOTAL TAX:	3924
TOTAL PAYMENTS:	3050
AMOUNT DUE:	874

2024 Vita Foreign Student Test – Retest Questions with Answers

2025-03-26T18:21:00.000-07:00

2024 Forein Student Test/Retest Questions – Answers:

2024 Foreing Student Test Pass 96% Proof:

Residency Status, Form 8843, and Filing Status – Test Questions:
2024 Foreing Student Pass 96% Proof:
Introduction:
This section of the VITA/TCE certification Foreign Student test covers determining residency status, the use of Form 8843, and filing status. It consists of 13 true/false questions.

1. Maylor entered the U.S. on July 30, 2021 as a student in F-1 immigration status. He had never been to the United States before and he did not change immigration status during 2024. For 2024 federal income tax purposes, Maylor is a resident alien.
a. True
b. False Answer
2. Amelia is a visiting professor at the local university. Amelia was a graduate student from June 2020 to May 2022 in F-1 immigration status. She re-entered the United States as a teacher on December 20, 2023 in J-1 immigration status. For 2024 federal income tax purposes, Amelia is a ________.
a. Nonresident alien
b. Resident alien Answer
3. Lucas was a student in F-1 immigration status from December 2015 through June 2023. In August of 2024, Lucas returned to the United States as a graduate student. For 2024 federal income tax purposes, Lucas is a ________.
a. Resident alien Answer
b. Nonresident alien
4. Antonio came to the United States in F-2 immigration status with his wife on July 15, 2020. He has not changed his immigration status. For 2024 federal income tax purposes, Antonio is a ________.
a. Resident alien
b. Nonresident alien Answer
5. Anne was in the U.S. as a child in J-2 immigration status with her parents from 2012 through 2015. She re-entered the U.S. in 2023 as a student in J-1 immigration status. The time she was present in the U.S. as a child is considered when determining her total number of years with exempt days.
a. True Answer
b. False
6. Janice entered the United States on August 1, 2020 in J-1 student immigration status. On August 10, 2023, her husband Rick joined her in J-2 immigration status. Janice and Rick had no income in 2024.
Are Janice and Rick required to file any form(s)?
a. Yes, Form 8843 Answer
b. No, no forms required
c. Yes, 1040NR and Forms 8843
d. Yes, 1040 filing married filing jointly
7. Janice and Rick from Question 6 have twins prior to entering the US. For 2024, how many Form(s) 8843 does Janice's family need to file?
a. 1
b. 2
c. 3
d. 4 Answer
8. Jocelyn and Connor have been in the U.S. in F-1 immigration status, since July, 2018. Their 12-year old daughter Arya, has been attending boarding school since June, 2017 on F-1 immigration status. For 2024, who must file Form 8843?
a. Arya
b. All three of them
c. None of them Answer
d. Jocelyn and Connor
9. Ayesha is from Pakistan and is a Ph.D. student in cyber security who is going to defend her dissertation in June 2025. She arrived in the U.S. as a student in F-1 immigration status on June 30, 2021. For 2024 federal income tax purposes, is Ayesha a nonresident alien?
a. Yes Answer
b. No
10. Klaus is a junior majoring in marine biology. He is in the U.S. as a student in F-1 immigration status from Germany. He transferred from a German university and arrived in the U.S. on April 15, 2021. Klaus worked in a lab on campus and as a summer intern for a company in New York. He will graduate in May 2025. For tax purposes, Klaus is considered a ___________.
a. Resident alien
b. Nonresident alien Answer
11. Cyriltavo is a nursing student from Greece who first arrived in F-1 immigration status on August 15, 2024. He did not work or receive a scholarship in 2024, but had $100 interest income from his U.S. savings account his parents set up for him to pay for school and his living expenses. Cyriltavo must file Form 1040-NR for 2024.
a. True
b. False Answer
12. Orlando entered the U.S. in J-1 immigration status as a trainee in January 2023 and lives alone. His wife, Bey, could not accompany due to on-going health concerns. Orlando must file as a______________ even though his spouse was not present in the U.S.
a. Single
b. Qualifying Surviving Spouse (QSS)
c. Married Filing Separately (MFS) Answerr
13. Tomas and Olga were married in March 2020. The next year, they both entered the U.S. in F-1 immigration status to complete their studies as Fulbright scholars. Currently, Tomas lives in San Diego where he is completing his graduate work. However, Olga left him in March 2024 and has not been heard from since. Her parents will not tell him where she lives. Although Tomas does not know Olga's whereabouts, he still must file as Married Filing Separately (MFS).
a. True Answer
b. False

2024 Foreign Student Scenario 1 Gabriel Alvarez – Interview Notes and 4 Questions:
Use the following information to prepare Form 8843.

• Gabriel Alvarez came to the U.S. to study on August 1, 2021, in F-1 immigration status. His passport number is 4682936 and it was issued by his home country, Peru. His home address is 31 Rue de Santos, Lima, 07001, Peru. His address at school is Stanford University, 450 Jane Stanford Way, Stanford, CA 94305. His U.S. taxpayer identification number is XXX-XX-XXXX.
• Gabriel is attending Stanford University, 450 Jane Stanford Way, Stanford, CA 94305, telephone 612-555-XXXX. His specialized program is Alternative Fuel Systems and the director is Professor Marri M. Young, also at 450 Jane Stanford Way, Stanford, CA 94, telephone 612-555-XXXX ext. 1267.
• Gabriel has not taken steps to apply for permanent residency. Gabriel had no income, so he is not required to file any other tax forms. Gabriel has not left the U.S. since arriving.
• After completing the required tax form, review the scenario and resource materials, and answer each of the test questions.

To answer the following multiple choice questions, refer to the Form 8843 you completed for Gabriel Alvarez.
14. Gabriel reports his most current nonimmigrant status on line 1a.
a. True
b. False Answer
15. Gabriel should put 365 days on line 4b, for days of exempted presence for 2024.
a. True Answer
b. False
16. What parts of Form 8843 does Gabriel need to complete?
a. Part I
b. Parts I and III Answer
c. Parts I and II
d. Part II
17. Gabriel must submit his Form 8843 for tax year 2024 by April 15, 2025?
a. True
b. False Answer

Taxability of Income, ITINs, and Credits – 7 Test Questions:
Introduction:
This segment of the VITA/TCE certification test includes 7 questions on taxability of income, ITINs, and credits.

18. Jenna, who is a nonresident alien and is in the United States in J-1 immigration status, spent $4,400 on qualifying education expenses. She is eligible to claim an education credit on her tax return.
a. True
b. False Answer
19. Lacey received $100 of dividend income on U.S. stocks she purchased online. She is an international student from Canada in F-1 immigration status. She arrived in the United States in 2023. How much of Lacey's dividend income will be taxed at 30%?
a. $0, it's taxed at the ordinary rate
b. $0, Per Publication 4011, the correct tax rate is 15% Answer
c. $100
20. Tonya and Paul are a married nonresident alien couple from France. Both are in the U.S. in F-1 immigration statuses and arrived in 2024. They paid $3,700 in childcare expenses, while attending school, for their child who was born in the United States and is a U.S. citizen. They are eligible to claim the child and dependent care credit on their Form 1040-NR.
a. True
b. False Answer
21. Jaden is a student in J-1 immigration status from Latvia. He earned $2,300 in wages in 2024. His wages are reported to him on Form 1042-S (Box 1, Income Code 20). Should Jaden report his wages on Form 1040-NR, Schedule OI?
a. Yes Answer
b. No
22. Cyril is a student in the U.S. in J-1 immigration status as of October 15, 2024. Under the terms of his visa, he is permitted to work in the U.S. Cyril qualifies for a Social Security number and should not apply for an ITIN.
a. True Answer
b. False
23. Mihaela, a student in F-1 immigration status from Slovenia, is on the tennis team. Mihaela arrived in the U.S. on July 20, 2024 on a full athletic scholarship that includes $8,000 for room and board and $28,000 for tuition and fees. What amount will be taxable on Mihaela Form 1040-NR?
a. $36,000r
b. $28,000
c. $8,000
d. $0.00 Answer
24. Stefan is a student in the U.S. in F-1 immigration status. Stefan arrived from Germany on August 5, 2022. Stefan worked in the bookstore and earned $3,200 in wages and had federal income tax withholding of $330. Stefan is only required to file Form 8843 for 2024.
a. True
b. False Answer

2024 Foreign Student Scenario 2 Kim Lee Interview Notes – 5 Test Questions:
Use the following information to prepare Form 1040-NR.
• Kim Lee, a citizen of South Korea, came to the United States in F-1 immigration status (number 3344123344) on January 01, 2024.
• He has remained in the country since then and is a full-time student at the local university. Kim, born July 25, 2001, is single. He began working at the university on February 10, 2024.
• He filed the proper withholding and treaty forms with the university payroll office before beginning his job. Since filing these forms correctly, he received a Form 1042-S for the treaty benefit for his wages. Kim was not in the U.S. before and therefore, has not filed an U.S. tax return in any prior year.
• Kim also received a scholarship from the university he was attending. He filed the appropriate forms to claim his treaty benefit for the scholarship. Therefore, he received a Form 1042-S.
• Kim’s address in South Korea is Bldg. 102 Unit 304, Sajik-ro-3-gil (Street) 23, Jongno, Seoul (South Korea) 30174. If he is entitled to a refund, he wants a direct deposit to his checking account. The routing number is 123456789 and the account number is 98765432100. He doesn’t want to designate anyone to discuss his return with the IRS. He did not take any affirmative steps to apply for permanent residence in the U.S. Kim’s U.S. income will not be taxed in his home country.
• Using the following information (two Forms 1042-S and a Form W-2), complete Kim’s federal income tax return. (Kim would also need to file Form 8843, but assume that he has already completed that on his own.)
• After completing the required tax form, review the scenario and resource materials, and answer each of the test questions.

2024 Foreign Student Scenario 2 Kim Lee – 5 Test Questions:
Directions: To answer the following multiple choice questions, refer to the Form 1040-NR you completed for Kim Lee.
25. Is $8,500 the amount entered on the line for Total amount from Form(s) W-2, box 1 on Form 1040-NR?
a. Yes Answer
b. No
26. Is $8,500 the amount of adjusted gross income on the Form 1040-NR?
a. Yes Answer
b. No
27. What is the amount of Itemized deductions on the Form 1040-NR?
a. $0.00
b. $80 Answer
c. $800
d. $880
28. Is $8,420 the amount for taxable income on the Form 1040-NR?
a. Yes Answer
b. No
29. What is the total amount entered for Total income exempt by a treaty from Schedule OI?
a. $0
b. $2,000
c. $6,000
d. $8,000 Answer
Solution to Question 29:
Form 1042-S Income Code 20:
Korea South – Treaty Benefits for Studying Income Code 20: Max Years in U.S. 5 and Max Dollar Amounts $2000.
Form 1042-S Income Code 16:
Korea South – Treaty Benefits for Scholarship Grants Income Code 16: Max Years in U.S. 5 and Max Dollar Amounts No Limits.
Total income exempt by a treaty from Schedule OI is $2000 + $6000 = $8,000.

2024 Foreign Student Scenario 3 Amar Pavan – Interview Notes:
Use the following information to prepare Form 1040-NR.
• Amar Pavan, a citizen of India, came to the United States as a student. He entered in F-1 immigration status (visa number 88779914) on September 1, 2021. He has remained in the country since then and is a full-time student at the local university.
• Amar was born on July 30, 2000, and is single. He filed the proper treaty and withholding forms with the university payroll office. Amar has filed a U.S. tax return Form 1040-NR for 2023. His address in India is B block, GK II, New Delhi – South, Delhi NCR, India.
• If he is entitled to a refund, he wants it mailed to him. He doesn’t want to designate anyone else to discuss his return with the IRS. Amar has not taken any steps to apply for permanent residence in the U.S.
• He will not be taxed in his home country on the income he has from the U.S. Using the following Form W-2, prepare Amar’s federal income tax return. (He has already completed his Form 8843.)
• Amar received $25 in bank interest from an account he opened with money from his parents, this money is not connected with a U.S. trade or business.
• He owed additional State Income tax when he filed his taxes last year. He mailed a payment of $85 on April 1, 2024 to his state.
• He donated $200 to the American Red Cross as a charitable contribution.
• He also donated $1,000 cash to his church but has no record.
• After completing the required tax form, review the scenario and resource materials, and answer each of the test questions.

2024 Foreign Student Scenario 3 Amar Pavan – 4 Test Questions:
Directions:
To answer the following questions, refer to the Form 1040-NR you completed for Amar Pavan.
30. What is the Adjusted Gross Income (AGI) on Form 1040-NR?
a. $12,400
b. $25,800
c. $27,000 Answer
d. $27,025
31. Amar Pavan is a student who is considered a resident of India. According to the U.S.-India Tax Treaty, he can take the standard deduction instead of itemizing.
a. True Answer
b. False
Solution to Question 31:
Yes, an international student from India studying in the US on an F, J, or M visa can generally take the standard deduction on their U.S. income tax return.
32. Amar will have a refund on Form 1040-NR?
a. True Answer
b. False
33. The taxable income line on Amar’s Form 1040-NR shows $25,800.
a. True
b. False Answer

2024 Foreign Student Scenario 4 Sonya Ivanov – Interview Notes and 4 Test Questions:
Use the following information to prepare 2024 Form 1040-NR.
• Sonya Ivanov is a resident of Bulgaria (visa number 38755219). She arrived in the United States in F-1 immigration status on September 1, 2022 as a full-time student. Sonya is 25 years old, single, born on July 11, 1998. Her address in Bulgaria is Vna 74117 Varna, Grand Mol Varna, 9021 Bulgaria.
• Sonya has not taken any steps to apply for permanent residence in the United States. Sonya did not file a Form 1040-NR in 2023 as she did not work that year. She started a new job with the university bookstore on January 20, 2024.
• If she is entitled to a refund, she wants a direct deposit to her checking account. The routing number is 789654321 and the account number is 011233456789. She will not be taxed by the Bulgarian government on the income she has earned in the United States. Assume Sonya has already completed her Form 8843, and prepare her federal income tax return with the following Form W-2. College Town University reports all student income on Form W-2. Miss Ivanov failed to respond to the university in time for them to properly issue Form 1042-S for her treaty-exempt income. However, she is still entitled to take her treaty benefit on her tax return instead.
• After completing the required tax form, review the scenario and resource materials, and answer each of the test questions.

2024 Foreign Student Scenario 4 Sonya Ivanov – 4 Test Questions:
Directions:
To answer the following multiple choice questions, refer to the Form 1040-NR you completed for Sonya Ivanov.
34. Sonya is allowed to exclude all of her wages as a treaty benefit on Schedule OI?
a. True
b. False Answer
Solution for Question 34:
No, the IRS does not allow a complete exclusion of all wages as a Bulgaria treaty benefit.
While the US-Bulgaria income tax treaty offers some benefits to residents of Bulgaria working in the US, it does not provide a complete exclusion of all wages from US taxation for nonresident aliens.
35. The total amount of the W-2, box 1, wages, salaries, tips, is reported on the Total amount from Form(s) W-2, box 1 line of the Form 1040-NR.
a. True Answer
b. False
36. Form 1040-NR, schedule OI, line G shows Sonya's treaty benefit information.
a. True
b. False Answer
Solution for Question 36:
Schedule OI (Form 1040-NR) is used by nonresident aliens to provide additional information not directly entered on Form 1040-NR. This includes details about claiming benefits under a tax treaty, specifically on line G.
37. Sonya's itemized deductions is $0.00?
a. True
b. False Answer

2024 Foreign Student Refunds, Deductions, and the Best Form to Use – 13 Test Questions:
Introduction:
This part of the VITA/TCE certification test includes 13 true/false or multiple choice questions.
Allow approximately 20 minutes to complete this segment.
38. Erin, an international student from Ireland, has a Form W-2 that shows amounts withheld for Social Security and Medicare taxes. Erin is an F-1 student who first arrived in the U.S. in 2020. Can she file Form 843 to receive a refund of these taxes?
a. True Answer
b. False
Solution to Question 38:
Refunds of Social Security and Medicare Taxes erroneously withheld file Form 843 to claim refund. 39. Jorge and Marta are from Mexico. Jorge is a scholar at a local university in J-1 immigration status and Marta is in J-2 immigration status. Marta worked at a local boutique in 2024. Her Form W-2 shows Social Security and Medicare tax withholding, while Jorge's does not. Marta is entitled to the exclusion of Social Security and Medicare tax withholding as a spouse.
a. True
b. False Answer
Solution to Question 39:
Individuals in F-2 or J-2 immigration status are never exempt from FICA (Social Security and Medicare Taxes).
40. Li, an international student from People's Republic of China, received $10,100 of interest income in 2024 from a personal bank account in the U.S. he opened when he first arrived on August 27, 2021. He also had a $100 capital gain from some U.S. stock he sold. Li reports the stock sale on Schedule D.
a. True
b. False Answer
41. Jackson entered the United States for the first time in 2022. He is a resident of France and is in F-1 immigration status. Jackson won $1,200 at the local casino. Jackson will report the $1,200 on Schedule NEC.
a. True Answer
b. False
42. Maylor is a visiting scholar from Ireland. He arrived in the U.S. on September 1, 2023 in J-1 immigration status and was accompanied by his wife and son. They had a second child in 2024, born in the U.S. Maylor is required to file a federal income tax return. When he files his federal tax return, he cannot claim his wife and children as dependents.
a. True Answer
b. False
Solution to Question 42:
It's unlikely a visiting scholar from Ireland on a J-1 visa can claim a child born in the U.S. as a dependent on their U.S. tax return, unless the child is a U.S. citizen or resident alien.
43. Gilberto, a graduate student from Germany, is in F-1 immigration status. He has been here since April 1, 2024. He has receipts for his donations to his church in Germany as well as donations made to a U.S. charity. Gilberto can claim all his charitable contributions as an itemized deduction on Form 1040-NR.
a. True
b. False Answer
44. Aretha is in F-1 immigration status from Chile. She entered the United States in August 2020 and enrolled as a full-time undergraduate student. Aretha is pursuing her first degree in mathematics. Aretha qualifies for the American opportunity credit.
a. True
b. False Answer
45. Jenna is a single, nonresident alien who began studying in the U.S. in 2020 in F-1 immigration status from Ecuador. She has wages of $9,300, interest income from her savings account of $175, $50 of dividends, and sold $4,500 of U.S. stocks for a $250 capital gain. She donated $50 of the proceeds to a local charity. Jenna cannot have her return prepared at any Foreign Student and Scholar VITA site, because she has capital gain income.
a. True
b. False Answer
Solution to Question 45:
IRS Volunteer Income Tax Assistance (VITA) program can help taxpayers with reporting capital gains and losses from the sale of stock.
46. Some students and scholars may owe money with their tax return. Generally, nonresidents have the option to set up an installment agreement.
a. True Answer
b. False
47. Dmitry, who is from Russia, earned wages of $12,335 in 2023. He had $280 withheld for state income taxes. He listed the state taxes as a deduction on his federal tax return in 2023 which lowered his taxable income. Dmitry received a state refund of $200 in 2024 from the 2023 tax return. Will Dmitry report his state tax refund as income on his Form 1040-NR in 2024 or amend his 2023 return?
a. He needs to include the state income tax refund on his 2024 federal return. Answer
b. He will remove the $125 state taxes from his 2023 deductions with an amended return.
c. He does not need to do anything with his state income tax refund.
48. Brunilda came to the U.S. in 2022 for postgraduate study. She took out a student loan to help pay the tuition through her school’s financial aid office. Brunilda graduated in December 2023 but remained in the U.S. for one year of practical training. She began repaying the loan on August 1, 2024 and paid $65 in interest during 2024. Where can Brunilda claim this interest?
a. Itemized deduction
b. Credit
c. Adjustment to income Answer
d. None of the above
Solution to Question 48:
From Schedule 1 (Form 1040) line 21 Student loan interest deduction and Form 1040-NR line 10 Adjustments to income from Schedule 1 (Form 1040), line 26. These are your total adjustments to income.
49. Matteo, a student from Malta, had $8,500 in wages reported to him on Form W-2. Although all of his wages are excluded from tax by treaty, he is required to file a tax return.
a. True Answer
b. False
50. Mustafa is a resident of Egypt attending college in the U.S. He arrived on J-1 immigration status in June of 2024. He had $15,800 in wages reported on Form W-2 and $39 in dividend income. Mustafa must complete both Schedules OI and NEC with his Form 1040-NR.
a. True Answer
b. False

2024 RETURNS VITA Advanced Course Test/Retest with Interview Notes.

2024-11-30T18:26:00.017-08:00

2024 Advanced Course Scenarios Test/Retest Questions – Answers with Solutions:

2024 Advanced Exam Score 100% Proof:

Advanced Scenario 1 Sharon Smith – Interview Notes:
• Sharon's husband, Daniel, moved out of their home in February of 2022. Sharon has had no contact with Daniel since he moved out. Sharon and Daniel are not legally separated.
• Sharon has one child, Lea, age 10. She will claim Lea as a dependent on her 2024 tax return.
• Sharon is 31 years old.
• Sharon earned $44,500 in wages and received $50 of interest. Sharon had lottery winnings of $2,000 reported on Form W-2G.
• Sharon paid all the costs of keeping up her home. She provided over half of the support for Lea.
• They all are U.S. citizens and have valid Social Security numbers. They lived in the U.S. all year.
Advanced Scenario 1 Sharon Smith – Test Questions:
1. Sharon qualifies for Head of Household filing status.
a. True ANSWER
b. False
2. Who qualifies to claim the Earned Income Credit (EIC) also known as Earned Income Tax Credit (EITC) for Lea?
a. Sharon ANSWER
b. Daniel
c. Both Sharon and Daniel
d. Neither Sharon nor Daniel
3. Sharon is required to report her lottery winnings as income on her federal tax return.
a. True ANSWER
b. False
Advanced Scenario 1 Sharon Smith – Retest Questions:
1. What is the most beneficial allowable filing status that Sharon is eligible to claim on her 2024 tax return?
a. Single
b. Married Filing Separately
c. Qualifying Surviving Spouse (QSS)
d. Head of Household ANSWER
2. Based on the information provided, Sharon qualifies for the Earned Income Credit.
a. True ANSWER
b. False
3. Sharon does not need to report her gambling winnings on her federal tax return.
a. True
b. False ANSWER
Advanced Scenario 2 Jeff and Jane Spring – Interview Notes:
Interview Notes:
• Jeff and Jane are married and want to file a joint return.
• Jeff is a U.S. citizen and has a valid Social Security number. Jane is a resident alien and has an ITIN. They resided in the United States all year with their children.
• Jeff and Jane have two children, Joan, age 7, and Jim, age 15. Joan and Jim are U.S. citizens and have valid Social Security numbers.
• Jeff earned $23,000 in wages.
• Jane earned $21,000 in wages.
• In order to work, the Springs paid $2,000 to their son, Jim, to care for Joan after school.
• Jeff and Jane provided all of the support for their two children.
Advanced Scenario 2 Jeff and Jane Spring – Test Questions:
4. What is the maximum amount Jeff and Jane are eligible to claim for the Child Tax Credit (CTC).
a. $6,000
b. $4,000 ANSWER
c. $3,000
d. $2,000
5. The Springs qualify for the Child and Dependent Care Credit
a. True
b. False ANSWER
Advanced Scenario 2 Jeff and Jane Spring – Retest Questions:
4. The maximum amount Jeff and Jane are eligible to claim for the Child Tax Credit is $2,000.
a. True
b. False ANSWER
5. Payments made to Jim can be claimed on Form 2441 as child and dependent care expenses.
a. True
b. False ANSWER
Question 4 Solution:
Child Tax Credit (partially refundable). The Child Tax Credit for 2024 is up to $2,000 per qualifying child. To qualify, a child must have a Social Security number. Be under age 17 at the end of 2024. Be claimed as a dependent on your tax return.
Question 5 Solution:
Can a family member get paid for childcare IRS?
Payments may be qualified childcare expenses if the family member babysitting isn't your spouse, the parent of the child, your dependent, or your child under age 19,
What is the child dependent care credit for 2024?
For 2024, the maximum eligible expense for this credit is $3,000 for one qualifying child and $6,000 for two or more.
Advanced Scenario 3 Mary Wood – Interview Notes:
Interview Notes:
• Mary Wood, age 58, is single.
• Mary earned wages of $51,000 and was enrolled the entire year in a high deductible health plan (HDHP) with self-only coverage.
• During the year, Mary contributed $2,000 to her Health Savings Account (HSA) and her mother also contributed $1,000 to Mary's HSA.
• Mary's Form W-2 shows $1,150 in Box 12 with code W. She has Form 5498-SA showing $4,150 in Box 2.
• Mary has Form 1099-SA showing her HSA distributions. She used her distributions to pay the following unreimbursed expenses:
o $500 for nine visits to a physical therapist after her knee surgery
o $1,000 unreimbursed doctor bills
o $280 prescription medicine
o $1,500 replacement of a crown
o $300 deep cleaning for teeth
o $40 over the counter medication
o $260 gym membership (for her general health and fitness)
• Mary is a U.S. citizen with a valid Social Security number.

Advanced Scenario 3 Mary Wood – Test Questions:
6. Mary is eligible to contribute an additional $__________ to her HSA because she is age 55 or older.
a. $0
b. $850
c. $1,000 ANSWER
d. $2,000
7. Form 8889, Part I is used to report HSA contributions made by _______________.
a. Mary
b. Mary's employer
c. Mary's mother
d. All of the above ANSWER
8. What is the total unreimbursed qualified medical expenses reported on Form 8889, Part II?
a. $3,860
b. $3,620 ANSWER
c. $3,580
d. $3,320
Solution:
500 + 1000 + 280 + 1500 + 300 + 40 = 3620 and the ANSWER
Advanced Scenario 3 Mary Wood – Retest Questions:
6. Mary is eligible to contribute an additional $2,000 to her HSA because she is age 55 or older.
a. True
b. False ANSWER
7. Mary cannot include her mother's contribution on Form 8889, Part I.
a. True
b. False ANSWER
8. The gym membership is a qualified medical expense for HSA purposes.
a. True
b. False ANSWER
Question 6 Solution:
For 2024, the annual contribution limits on deductions for HSAs for individuals with self-only coverage is $4,150 (increase of $300) and $8,300 for family coverage (increase of $550).
There is an additional contribution amount of $1,000 for taxpayers who are age 55 or older.
Advanced Scenario 4 Cheryl Brown – Interview Notes:
Interview Notes:
• Cheryl, age 62, is single. She owns her home and provided all the costs of keeping up her home for the entire year. Her only income for 2024 was $48,700 in W-2 wages.
• Cindy, age 24, and her daughter Cary, age 5, have lived with Cindy's mother, Cheryl, since Cindy separated from her spouse in April of 2023. Cindy's only income for 2024 was $24,000 in wages. Cindy provided over half of her own support. Cary did not provide more than half of her own support.
• Cindy will not file a joint return with her spouse.
• All individuals in the household are U.S. citizens with valid Social Security numbers. No one has a disability. They lived in the United States all year.

Advanced Scenario 4 Chery Brown – Test Questions:
9. For the purpose of determining dependency, Cary could be the qualifying child of _______________.
a. Only Cheryl
b. Only Cindy
c. Either Cheryl or Cindy ANSWER
d. Neither Cheryl nor Cindy
10. Which of the following statements is true?
a. Cindy is not eligible to claim Cary for the EIC because her filing status is married filing separate.
b. Cindy is not eligible to claim the EIC for Cary because she is under age 25.
c. Cindy is not eligible to claim Cary for the EIC because her income is too high.
d. None of the above statements is true. ANSWER

Advanced Scenario 4 Chery Brown – Retest Questions:
9. Which of the following statements is true:
a. Cindy may not claim Cary as a dependent since Cheryl paid all of their housing costs.
b. Cheryl may claim Cary as a dependent if Cindy chooses not to claim her. ANSWER
c. Only Cheryl may claim Cary as a dependent since her income is higher than Cindy's income.
d. Only Cindy may claim Cary as a dependent since Cary is her daughter.
10. Cindy is eligible to claim Cary for the Earned Income Credit.
a. True ANSWER
b. False
Advanced Scenario 5 Elizabeth Greene – Interview Notes:
Interview Notes:
• Elizabeth is 54 years old and files as single.
• Her 2024 adjusted gross income (AGI) is $52,000, which includes gambling winnings of $2,000.
• Elizabeth would like to itemize her deductions on Form 1040 Schedule A this year.
• Elizabeth brings documents for the following items:
o $9,500 hospital and doctor bills
o $600 contributions to Health Savings Account (HSA)
o $3,600 state withholding (higher than Elizabeth's calculated state sales tax deduction)
o $300 personal property taxes based on the value of the vehicle
o $600 friend’s personal GoFundMe campaign
o $350 cash contributions to the Red Cross
o $200 fair market value of clothing (in good used condition) donated to the Salvation Army (Elizabeth purchased the clothing for $900)
o $7,300 mortgage interest
o $2,300 real estate tax
o $1,500 homeowners association fees
o $4,000 gambling losses

Advanced Scenario 5 Elizabeth Greene – Test Questions:
11. Elizabeth can claim the $1,500 homeowners association fees as a deduction on her Form 1040, Schedule A.
a. True
b. False ANSWER
12. What amount of gambling losses is Elizabeth eligible to claim as a deduction on her Form 1040, Schedule A?
a. $0
b. $1,000
c. $2,000 ANSWER
d. $4,000

Advanced Scenario 5 Elizabeth Greene – Retest Questions:
11. If Elizabeth chooses to itemize, which of the following is not an eligible deduction on Form 1040, Schedule A?
a. $7,300 mortgage interest
b. $1,500 homeowners association fees ANSWER
c. $2,300 real estate tax
d. $350 contribution to the Red Cross
12. Elizabeth is eligible to claim $4,000 in gambling losses as a deduction on her Form 1040, Schedule A.
a. True
b. False ANSWER
Advanced Scenario 6 David Stone – Interview Notes:
Interview Notes:
• David Stone is 28 years old and single. He provides all of his own support.
• David works at a gas station and earned $18,500 in wages.
• David took two management courses at a community college to improve his job skills. He was less than a half time student. He wants to know if that qualifies for any educational tax benefit.
• David took an early distribution from his IRA of $2,000 for tuition and $500 for emergency repairs of his air conditioning system. This is the first time he has taken a distribution from his IRA.
• David is a U.S. citizen and lived in the U.S. for the entire year. He has a valid Social Security number.
Advanced Scenario 6 David Stone – Test Questions:
13. David is eligible to claim the American Opportunity Credit on his 2024 tax return.
a. True
b. False ANSWER
14. For which of the following IRA distributions will David owe an additional tax of 10%?
a. $2000 for tuition
b. $500 for emergency repairs
c. Both a and b
d. Neither a or b ANSWER
Advanced Scenario 6 David Stone – Retest Questions:
13. David's modified adjusted gross income (MAGI) must be less than $90,000 to claim the Lifetime Learning Credit in 2024.
a. True ANSWER
b. False
14. David will owe an additional $50 tax on the $500 IRA distribution for emergency repairs?
a. True
b. False ANSWER
Solution:
IRS Retirement topics - Exceptions to 10% Additional Tax on Early Distributions:
You must file Form 5329 to report an exception to the 10% additional tax on an early distribution from a qualified retirement plan like IRA.

Exceptions to 10% Additional Tax on Early Distributions

Advanced Scenario 7 Vincent and Faith Hunter – Interview Notes:
Directions:
Using the tax software, complete the tax return, including Form 1040 and all appropriate forms, schedules, or worksheets. Answer the questions following the scenario.

When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice.
Interview Notes:
• Vincent is a 5th grade teacher at a public school. Vincent and Faith are married and choose to file Married Filing Jointly on their 2024 tax return.
• Vincent worked a total of 1,800 hours in 2024. During the school year, he spent $844 on unreimbursed classroom expenses.
• Faith retired in 2021 and began receiving her pension on November 1st of that year. She explains that this is a joint and survivor annuity. She has already recovered $1,259 of the cost of the plan.
• Vincent settled with his credit card company on an outstanding bill and brought the Form 1099-C to the site. They aren’t sure how it will impact their tax return for tax year 2024. The Hunters determined that they were solvent as of the date of the canceled debt.
• Faith received $280 from Jury duty.
• Their daughter, Hope, is in her second year of college pursuing a bachelor’s degree in Physics at a qualified educational institution. She received a scholarship, and the terms require that it be used to pay tuition. The Hunters provided Form 1098-T and an account statement from the college that included additional expenses. On Form 1098-T for the previous tax year, Box 7 was not checked. The Hunters paid $1,500 for books and equipment required for Hope's courses. This information is also included on the college statement of account. The Hunters claimed the American Opportunity Credit last year for the first time.
• Hope does not have a felony drug conviction.
• They are all U.S. citizens with valid Social Security numbers.

2024 Advanced Scenario 7 Vincent and Faith Hunter – Test Questions:
15. What is the taxable portion of Faith's pension from Liberty Enterprises using the simplified method?
a. $0
b. $18,841.00
c. $19,519.00 ANSWER
d. $20,100.00
Solution:

Taxpayer Born 1964

Spouse Born 1955

Taxpayer’s Age 2024-1964=60

Spouse’s Age 2024-1955=69

Combine Age 69+60=129

Combine Age at 2021 Pension Start Date is 2024-2021=3 and 129-3=126

16. The Hunters are eligible to claim the credit for other dependents on their tax return.
a. True ANSWER
b. False
17. What is the total amount of other income reported on the Hunters' Form 1040 Schedule 1?
a. $0
b. $280
c. $850
d. $1,130 ANSWER
Solution for Other Income from Schedule 1:

$850 Cancelation of Debt +

$280 from Jury duty

$1,130 Total Other Income from Schedule 1

18. Vincent is eligible to deduct qualified educator expenses in the amount of $____________300.
(Note: whole number only, do not use special characters.)
19. What is the Hunters' standard deduction on their 2024 tax return?
a. $21,900
b. $23,450
c. $29,200
d. $30,750 ANSWER
Solution:

20. Which of the following expenses qualify for the American Opportunity Credit?
a. Required course related books and equipment
b. Tuition
c. Parking pass
d. Both a and b ANSWER
21. The taxable amount of Faith's Social Security income as reported on their Form 1040 is:
a. $ 0
b. $19,413
c. $20,314 ANSWER
d. $23,899
Solution:

2024 Social Security Benefits Worksheet - Lines 6a and 6b:

22. What is the Hunters' total federal income tax withholding?
a. $4,400
b. $5,210
c. $5,590
d. $7,600 ANSWER

2024 Advanced Scenario 7 Vincent and Faith Hunter – Retest Questions:
15. The taxable portion of Faith's pension from Liberty Enterprises using the simplified method is $23,899.
a. True
b. False ANSWER
16. Which of the following credits are the Hunters able to claim on their federal tax return?
a. American Opportunity Credit ANSWER
b. Earned Income Credit
c. Child Tax Credit
d. Premium Tax Credit
17. The total amount of other income reported on the Hunters' Form 1040, Schedule 1 is $1,130.
a. True ANSWER
b. False
18. What is the amount Vincent is eligible to claim as qualified educator expenses on Form 1040, Schedule 1?
a. $0
b. $250
c. $300 ANSWER
d. $844
19. The Hunters' standard deduction on their Form 1040 for tax year 2024 is $29,200.
a. True
b. False ANSWER
20. Which is not a qualifying expense for the American opportunity credit?
a. Tuition
b. Required course related books
c. Parking pass ANSWER
d. Required course related equipment
21. All of Faith's Social Security benefits are taxable according to the Social Security benefits worksheet.
a. True
b. False ANSWER
22. The federal income tax withholding reported on the Hunters' Form 1040 is $4,400
a. True
b. False ANSWER
Solution: 2390+2010+3200=7600 The total federal income tax withholding.

Advanced Scenario 8 Stephanie Winter – Interview Notes:
Interview Notes:
• Stephanie is a paralegal, age 26, and single.
• Stephanie has investment income and a consolidated broker’s statement.
• Stephanie is self-employed delivering meals for Fast Eats on the weekends. She received a Form 1099- NEC and a Form 1099-K. She received additional cash payments of $570 including tips.
• Stephanie uses the cash method of accounting. She uses business code 492000.
• Stephanie provided a statement from Fast Eats indicating the fees paid for the year. These fees are considered ordinary and necessary for the food delivery business:
o $150 for insulated box rental
o $50 for vehicle safety inspection (required by Fast Eats)
o $600 for Fast Eats fees
• Stephanie also kept receipts for the following out-of-pocket expenses:
o $80 for tolls while making deliveries
o $300 for speeding ticket
o $160 for Stephanie's lunches
• Stephanie’s record keeping application shows she has driven a total of 3,000 miles during and between deliveries.
o She placed her only vehicle, an SUV, in service on 3/15/2020. The total mileage on her SUV for tax year 2024 was 12,500 miles. Of that, 9,500 miles were personal and commuting miles. Stephanie will take the standard business mileage rate.
• Stephanie is paying on her student loan from 2019, when she completed her undergraduate degree.
• Stephanie is working towards her Juris Doctorate degree to start a new career as a lawyer.
• She took a few college courses this year at an accredited college.
• Stephanie took an early distribution of $5,000 from her IRA in April. She used $2,400 of the IRA distribution to pay her educational expenses for the current year. She has never made any non-deductible contributions to her IRA.
• If Stephanie has a refund, she would like it deposited into her checking account.

Advanced Scenario 8 Stephanie Winter – Intake/Interview Page 1, 2 and 3:

Advanced Scenario 8 Stephanie Winter – Test Questions:
Directions:
Using the tax software, complete the tax return, including Form 1040 and all appropriate forms, schedules, or worksheets. Answer the questions following the scenario.

When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice.
23. The net short-term capital gain reported on Stephanie's Schedule D is $______. 250 ANSWER
(Note: whole number only,do not use special characters.)
24. Which of the following can be claimed as a business expense on Stephanie's Schedule C?
a. Tolls ANSWER
b. Speeding Ticket
c. Lunches
d. All of the above
25. Stephanie can take a student loan interest deduction of $3,750.
a. True
b. False ANSWER
26. What is the total standard mileage deduction for Stephanie's business on Schedule C?
a. $630
b. $1,965
c. $2,010 ANSWER
d. $8,040
Solution: 3,000 Miles x $0.67 = $2,010
27. The amount of Stephanie's lifetime learning credit is $480.
a. True ANSWER
b. False
Solution: 2400 x .20 = 480
28. What is Stephanie's additional 10% tax on the early withdrawal from her IRA on Form 1040 Schedule 2, Part II?
a. $0
b. $240
c. $260 ANSWER
d. $500
Solution:
$5,000 early distribution from IRA and used $2,400 to pay for education expenses so 5000-2400=2600 x 0.10=260 and the Answer.
29. To avoid having a balance due next year, Stephanie can use the IRS withholding estimator to calculate her tax liability and submit a new Form W-4 to increase her tax withholding.
a. True ANSWER
b. False
Solution:
The Tax Withholding Estimator online tool helps taxpayers see if they may get a refund or need to make a payment directly to the IRS to avoid a tax bill and penalties next year.

Advanced Scenario 8 Stephanie Winter – Retest Questions:
23. Stephanie's net short-term capital gain reported on Schedule D is $350.
a. True
b. False ANSWER
24. Stephanie can claim her lunches as a business expense on her Schedule C.
a. True
b. False ANSWER
Solution:
For details on business expenses, see Pub. 334, chapter 8.
25. What is the amount Stephanie can take as a student loan interest deduction on her Form 1040, Schedule 1?
a. $0
b. $750
c. $2,500 ANSWER
d. $3,750
Solution:
IRS Topic no. 456, Student loan interest deduction:
You may deduct the lesser of $2,500 or the amount of interest you actually paid during the year.
26. The total standard mileage deduction for Stephanie's business on Schedule C is $2,010.
a. True ANSWER
b. False
Solution:
3,000 Miles x $0.67 = $2,010

27. Which credit is Stephanie eligible for?
a. American Opportunity Credit
b. Earned Income Credit
c. Lifetime Learning Credit ANSWER
d. Premium Tax Credit
28. Stephanie will have to pay $240 additional tax because she received the early distribution from her IRA.
a. True
b. False ANSWER
Solution:
IRA early distribution of $5,000 and used $2,400 of the IRA distribution to pay for educational expenses 5000-2400=2600 x 0.10=260.
29. How can Stephanie prevent having a balance due next year?
a. She can increase the withholding on a new Form W-4.
b. She can make estimated tax payments.
c. She can do nothing and file as usual.
d. Both a and b. ANSWER

Advanced Scenario 8 Stephanie Winter – Tax Return and Tax Supporting Documents:

Advanced Scenario 9 Joe Lopez – Interview Notes:
Interview Notes:
• Joe is age 41 and was widowed in July, 2023. He has a daughter, Josie, age 9, who lived with him the entire year.
• Joe provided the entire cost of maintaining the household and over half of the support for Josie. In order to work, he pays childcare expenses to Southside Daycare.
• Joe purchased health insurance for himself and his daughter through the Marketplace. He received a Form 1095-A.
• Joe and Josie are U.S. citizens and lived in the United States all year in 2024.

Advanced Scenario 9 Joe Lopez – Test Questions:
Directions:
Using the tax software, complete the tax return, including Form 1040 and all appropriate forms, schedules, or worksheets. Answer the questions following the scenario.

When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice.
30. What is Joe's most advantageous filing status?
a. Single
b. Married Filing Separately
c. Head of Household
d. Qualifying Surviving Spouse (QSS) ANSWER
31. Joe adjusted gross income on his Form 1040 is _______.
a. $12,912
b. $42,000
c. $42,112 ANSWER
d. $42,140
Solution:
IRS adjusted gross income (AGI) on Form 1040 Line 11 is the total gross income from all sources minus adjustments.
32. Joe is eligible to claim the Child Tax Credit.
a. True ANSWER
b. False
Solution:
1. Who qualifies:
You can claim the Child Tax Credit for each qualifying child who has a Social Security number under 17 at the end of the tax year.
2. How to claim Child Tax Credit:
You can claim the Child Tax Credit by entering your children on Form 1040, and by attaching a completed Schedule 8812, Credits for Qualifying Children and Other Dependents.
33. Joe's retirement savings contributions credit is____.
a. $0 ANSWER
b. $100
c. $150
d. $1,500
Solution:
IRS Form W-2 Box 12a Code D for Retirement Plans: IRS W-2 Box 12a Code D for Retirement Contributions is used for 401(k) contributions. IRS 2024 Form 8880 Credit for Qualified Retirement Savings Contributions; You need to attach completed Form 8880 to Form 1040.
IRS no Error:
The answer a. $0 no error. The correct answer is a. $0.
2024 Saver's Credit if your AGI is more than $38,250 than there is 0% credit for your contribution for all Other Filers per IRS Table below.
IRS 2024 Saver’s Credit:
0% of your contribution for All other filers* (*Single, married filing separately, or qualifying widow(er)) if more than $38,250 of your AGI, see IRS Table below, and Joe’s AGI on Form 1040 Line 11 is equal to $42,112 therefore 0% credit, or no credit.

34. The total amount of Joe's net premium tax credit on Form 1040 Schedule 3, line 9 is $696.
a. True ANSWER
b. False
Solution:
The Premium Tax Credit is a refundable tax credit. IRS, you will need to complete Form 8962, Premium Tax Credit (PTC) and attach it to your tax return for the year.
35. Joe's child and dependent care credit from Form 2441 is _____. 630 ANSWER
(Note: whole number only, do not use special characters.)
Advanced Scenario 9 Joe Lopez – Retest Questions:
30. Joe can claim the Qualifying Surviving Spouse filing status.
a. True ANSWER
b. False
31. Joe's adjusted gross income is $42,140.
a. True
b. False ANSWER
32. Joe cannot claim which of the following credits on his tax return.
a. Child Tax Credit
b. Credit for Other Dependents ANSWER
c. Premium Tax Credit
d. Child and Dependent Care Credit
33. Joe qualifies to claim the Retirement Savings Contribution Credit.
a. True
b. False ANSWER
34. Joe's net premium tax credit on his Form 1040 Schedule 3, line 9 is $_______. 696 ANSWER
(Note: whole number only, do not use special characters.
35. Joe's child and dependent care credit is $630.
a. True ANSWER
b. False
Solution:
IRS How is the credit calculated?
The credit is calculated based on your income and a percentage of expenses that you incur for the care of qualifying persons to enable you to go to work, look for work, or attend school.
Joe's child and dependent care credit from Form 2441 is reported as a non-refundable credit on Form 1040, Schedule 3.
Paid $7,200 and only allowed $3000 Max for One Child.
Income from W-2 = $42,000
1040 Line 1 AGI $42,112 – Standard Deduction QSS $29,200 = $12,912.
Taxable Income $12,912 = Tax lability $1293.
2441 Line 8 .21 for AGI $42,112 x $3,000 = 630 ANSWER

Advanced Scenario 9 Joe Lopez – Intake/Interview Sheets:

2024 RETURNS VITA Puerto Rico Certification Course Test/Retest Level I and Level II with Interview Notes.

2024-11-29T18:02:00.000-08:00

2024 Puerto Rico VITA Certification Test Level I:

2024 Puerto Rico Level 1 Test – 100% Pass Proof:

The first five questions are designed to measure key competencies, including how to figure the allowable portion of standard deductions to U.S. income. They also encourage use of your research tools.

Use Publication 4696 PR – VITA/TCE Puerto Rico Resource Guide and Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return Form 1040 or Form 1040-SR to answer the questions.

2024 Pueto Rico Test Level I Test Questios – with Answers and Solutions:

Read each scenario carefully and use your reference materials Publication 4696 - VITA/TCE Puerto Rico Resource Guide and Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return (Form 1040 or Form 1040-SR) to answer the questions. Round all fractions to four decimal places.

Using your resource materials, answer the following questions:

1.1 Lauren was a resident of Puerto Rico during 2024. She is single and under 65 years of age. She works as a U.S. government employee and her salary was $36,000. She also received income of $4,000 from a part-time job in Puerto Rico not subject to U.S. tax. Use the worksheet on page 3 in Publication 1321 to calculate the allowable portion of the standard deduction.
What is the allowable portion of the standard deduction that Lauren can claim?
a. $11,773
b. $13,140 ANSWER
c. $16,550
d. $20,800
Solution:

1.2 German and Elena were residents of Puerto Rico in 2024. They are both over 65 years old and file a joint return. German is retired from the U.S. Postal Service and Elena is retired from the U.S. Veterans Affairs. Their taxable pensions were $29,000 and $42,000, respectively.
What is German and Elena’s standard deduction?
a. $21,900
b. $29,200
c. $32,300 ANSWER
d. $35,100
Solution:

1.3 Marco is 40 years old, qualifies to file Head of Household, and a resident of Puerto Rico during 2024. He informed you that he received the following sources of income: $12,500 for a job he performed in the state of Florida; $23,200 received from the federal government for services performed in Puerto Rico. He also received $6,300 from a part-time job in Puerto Rico that is exempt from federal income tax. Use the worksheet on page 3 in Publication 1321 to calculate the allowable portion of the standard deduction.
What is the allowable portion of Marco’s standard deduction?
a. $14,600
b. $15,700
c. $18,615 ANSWER
d. $21,900
Solution:
$12,500 $23,200 = $35,700 + $6,300 = $42,000

1.4 Karina is a bona fide resident of Puerto Rico, who received Social Security benefits and pension income from the University of Puerto Rico. Does Karina have U.S. source income?
a. Yes, she has U.S. source income. ANSWER
b. No, she does not have U.S. source income
1.5 Angel is single and received unemployment benefits from the Puerto Rico Department of Labor reported on a Form 1099-G. What is the factor determining source of income for unemployment?
a. Residence of the payee
b. The location of the payer
c. Unemployment compensation is generally considered sourced where the taxpayer performed the underlying services ANSWER
d. None of the above

2024 Level I PR Test Scenario 1 – Isabel Acosta
Taxpayer Documents:
Completed Intake/Interview and Quality Review Sheet
Form 499R-2/W-2PR, Puerto Rico Withholding Statement
Interview Notes:
• Isabel Acosta is employed as an executive secretary.
• Isabel is divorced with two children. Cecilia is 7 years old and Lucas is 16 years old.
• Isabel paid all the cost of keeping up the home and more than half the support for her children.
• Social Security numbers: Isabel Acosta 133-00-XXXX, Cecilia Valentin, daughter, 599-00- XXXX and Lucas Valentin, son, 598-00-XXXX.
• If she is entitled to a refund, Isabel would like to receive it via direct deposit.
• Isabel has a checking account from Any Town Credit Union Account Number: 54321 Routing Number: 123456789
• Isabel has an Identity Protection Personal Identification Number (IP PIN): 987654.
2024 Level I PR Scenario 1 Isabel Acosta – Test Questions:
Based on the information provided by Isabel Acosta, complete Form 1040-SS or Form 1040-SS (SP) and the required forms and schedules to answer the following questions. You are a volunteer at site S21014444.
1.6 What is the amount of the Additional Child Tax credit on line 19, Part II, in Form 1040-SS (SP)?
a. $0
b. $3,000
c. $3,400 ANSWER
d. $3,596
1.7 What filing status can Isabel use?
a. Head of Household ANSWER
b. Married Filing Jointly
c. Married Filing Separately
d. Qualifying surviving spouse
1.8 Isabel can file Form 1040-SS (SP) or Form 1040-SS to claim the Additional Child Tax credit.
a. True ANSWER
b. False
1.9 The IRS issues an Identity Protection Personal Identification Number (IP PIN) to protect and confirm taxpayer identity when submitting a tax return. Should the IP PIN be included on the Form 1040SS or Form 1040-SS (SP)?
a. Yes ANSWER
b. No
1.10 Isabel can claim up to $1,700 per child or the Social Security and Medicare taxes withheld from her wages, whichever is lower.
a. True ANSWER
b. False

2024 Level I PR Test Scenario 2 – Luis Abreu and Astrid Sevilla:
Taxpayer Documents:
Completed Intake/Interview and Quality Review Sheet
Form 499R-2/W-2PR, Puerto Rico Withholding Statement
Interview Notes:
• Luis Abreu and Astrid Sevilla are married and bona fide residents of Puerto Rico.
• Luis Abreu and Astrid Sevilla SSNs are 581-00-XXXX and 582-00-XXXX respectively.
• Astrid is a housewife who did not receive income during the year.
• Luis is an accountant for the Puerto Rico Tourism Company; his wages for this year were $53,000.
• His contributions for the Social Security and Medicare were $3,286 and $768.50, respectively.
• They have two children under 17 and an older child Henry, who is permanently and totally disabled.
• Luis and Astrid would like a direct deposit to their checking account 57892; routing number 02190XXXX with Boricua Bank.
• Name Date of Birth Relationship Social Security Number
1. Edward Abreu 3-12-2017 Son 583-00-XXXX
2. Maria Abreu 3-12-2017 Daughter 584-00-XXXX
3. Henry Abreu 6-01-2005 Son 586-00-XXXX

Level I PR Test Scenario 2 Luis Abreu and Astrid Sevilla – Test Questions:
Based on the information provided by Luis Abreu and Astrid Sevilla, complete Form 1040-SS or Form 1040-SS (SP) and the required forms and schedules to answer the following questions. You are a volunteer at site S21014444.

If you are using the Link and Learn Taxes Practice Lab, when entering Social Security numbers (SSNs) or Employer Identification Numbers EINs), replace the Xs as directed, or with any four digits of your choice. In classroom situations, replace the Xs with the information provided by your instructor.
1.11 What filing status can Luis Abreu and Astrid Sevilla claim on their return?
a. Single
b. Married Filing Jointly ANSWER
c. Head of Household
d. None of the above
1.12 How many dependents are eligible for the Additional Child Tax Credit (ACTC)?
a. 0
b. 1
c. 2 ANSWER
d. 3
1.13 How much is the Additional Child Tax Credit that Luis and Astrid are entitled to receive?
a. $0
b. $3,200
c. $3,400 ANSWER
d. $4,055
1.14 The modified adjusted gross income for Luis and Astrid is within the income limit to claim the Additional Child Tax Credit.
a. True ANSWER
b. False
1.15 Which form should be completed by Luis and Astrid to claim the Additional Child Tax Credit?
a. Form 1040NR and Schedule 8812
b. Form 1040 SS and Schedule 8812
c. Form 1040 SS (SP) or Form 1040-SS ANSWER
d. Any of the above.

2024 Puerto Rico VITA Certification Test – Level II:

2024 Puerto Rico Level 2 Test – 100% Pass Proof:

The first five questions are designed to measure key competencies related to figuring the allowable portion of itemized deductions to U.S. income; calculating foreign tax credit; and determining the taxable portion of Social Security benefits.

Read each scenario carefully and use your reference materials Publication 4696 VITA/TCE Puerto Rico Resource Guide and Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return) to answer the questions. Round all fractions to four decimal places.
2.1 Adan and Eva are both under age 65 and bona fide residents of Puerto Rico who file a joint return. Adan had received salary of $30,000 from his Puerto Rico sources. Eva works for the federal government and her salary was $45,000. Before calculating the allowable portion, they had the following eligible itemized deductions:
• Home mortgage interest: $6,000
• Real estate taxes: $400
• Charitable contributions: $700
What is the amount of calculated allowable itemized deductions that can be claimed?
a. $4,260 ANSWER
b. $7,100
c. $27,700
d. $29,200
Solution:
$45,000 Gov./$75,000 All sources=0.6 (3600+240+420=4260)
6000x0.6=3600
400x0.6=240
700x0.6=420
2.2 Calculate the allowable standard deduction for Adan and Eva (see exercise 2.1 above). Based on these calculations, the allowable standard deduction is higher than the allowable itemized deductions.
a. True ANSWER
b. False
Solution:
$29,200 Standard deduction Married filing jointly.
2.3 Franklin is a single taxpayer, 63 years old, and a bona fide resident of Puerto Rico with no dependents. Franklin received a Form SSA-1099, Social Security benefits, showing $31,000 in box 3. He did not receive any other income. Use Publication 4696 Social Security Benefits section as your reference materials. Is any part of his Social Security benefits subject to U.S. income tax?
a. Yes
b. No ANSWER
2.4 In 2024, Alex, 85 years old, resident of Puerto Rico, received $36,000 from his U.S. Civil Service pension. The benefits of this pension are attributed to a 25-year career with the federal government, in Puerto Rico.
Alex can claim a Foreign Tax Credit on Form 1040 for the income taxes paid to Puerto Rico.
a. True ANSWER
b. False
2.5 Santiago is single, 70 years old and received Form SSA-1099 for 2024, which shows benefits of $21,000 in box 5. He also received the following income during the year:

Taxable pension from the University of Puerto Rico of $37,000

Salary of $5,000 from a company in Puerto Rico

Taxable IRA distribution of $4,000 from a bank in Puerto Rico
Using Publication 915, Worksheet 1 and VITA/TCE Practice Lab https://vita. taxslayerpro.com/, what amount of his Social Security benefit is taxable to the United States?
a. $0
b. $10,500
c. $17,850 ANSWER
d. $21,000
Solution: $21,000x0.85=17,850
2024 Level II PR Test Scenario 1 – Andrea Gracia:
Taxpayer Documents:

Completed Intake/Interview and Quality Review Sheet

Form CSA 1099-R

Form SSA-1099
Interview Notes:
• Andrea Gracia is 70 and was born on January 2, 1954.
• Andrea’s SSN is 123-00-XXXX and her grandson Lucas Cruz’s SSN is 124-00-XXXX.
• Her grandson, Lucas, was born on July 23, 2008, has lived with her for the last three years and qualifies her to file as Head of Household.
• Andrea pays the total cost of keeping up a home for herself and her grandson.
• She does not want to contribute to the presidential election campaign.
• If a refund or balance is due, Andrea would like a direct deposit to or direct debit from her checking account 67890; routing number 021904512 with Coqui Credit Union.
• Her address and SSN are correct and were validated during the interview.
• Andrea is retired from the Civil Service Retirement System. She has a single life annuity and began receiving retirement benefits on January 5, 2010. The pension is attributed to services performed in New York. Andrea moved to Puerto Rico in 2010.
• Andrea receives Social Security benefits.
• According to the Simplified Method, Andrea can recover $2,667 of the cost of her pension tax free annually.

Taxpayer Documents:
Completed Intake/Interview and Quality Review Sheet:

2024 Level II PR Test Scenario 1 Test Questions – Andrea Gracia:
Please complete Form 1040, Publication 915, Worksheet 1, and the child tax worksheet to answer the following questions. You are a volunteer at site S21014444.

If you are using the Link & Learn Taxes Practice Lab (highly recommended), when entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice. In classroom situations, replace the Xs with the information provided by your instructor.
2.6 After considering the cost recovery of tax free amount; what is the taxable portion of Andrea’s pension?
a. $0
b. $15,000
c. $31,833 ANSWER
d. $34,500
Solution for Question 6 (Numbers from Form 1099-R – Statement of Annuity Paid):

Solution for age at annuity starting date:
Andrea Gracia is 70 and born 1954, and Annuity start date was 2010. 2024 – 2010 = 14 and 70 – 14 = 56.
2.7 Can Andrea claim a foreign tax credit for the taxes paid to Puerto Rico on her pension attributed to services she performed in New York?
a. Yes
b. No ANSWER
2.8 What is the amount of Andrea’s standard deduction?
a. $5,050
b. $14,600
c. $16,650
d. $23,850 ANSWER
2.9 Andrea can claim the Child Tax Credit.
a. Yes ANSWER
b. No
2.10 The taxable amount of Andrea’s Social Security benefit (from the Publication\ 915 worksheet) is $9,543.
a. Yes ANSWER
b. No
Solution for Question 2.10:

Level II PR Test – Scenario 2 Test Questions
Complete the Form 1040, schedules, and worksheet based on the information provided by David and Aixa, complete Form 1040, the required forms and schedules to answer the following questions. You are a volunteer at site S21014444.
If you are using the Link & Learn Taxes Practice Lab, when entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice. In classroom situations, replace the Xs with the information provided by your instructor.
2.11 David and Aixa’ss total income shown on line 1a of Form 1040 is:
a. $0
b. $83,024 ANSWER
c. $85,749
d. $89,273
2.12 David and Aixa are eligible to claim which of the following non-refundable credits on their 2024 tax return?
a. Other Dependent Credit
b. Foreign tax credit
c. Child Tax Credit
d. All of the above ANSWER
2.13 What is the amount of Foreign Taxes that should be entered on line 8 in Form 1116?
a. $0
b. $2,750
c. $4,835 ANSWER
d. $ 4,900
2.14 Which of the following items are included in the total payments on David and Aixa’s tax return?
a. Federal income tax withheld from Form W-2
b. Additional child tax credit
c. Child Tax Credit
d. Both a and b ANSWER
2.15 What is the taxable income reported on Form 1040?
a. $0
b. $53,824 ANSWER
c. $59,212
d. $61,124

2023 Puerto Rico VITA Certification Test Level I and Level II;

2023-10-11T15:09:00.000-07:00

2023 Puerto Rico VITA Certification Test Level I:
The first five questions are designed to measure key competencies, including how to figure the allowable portion of standard deductions to U.S. income. They also encourage use of your research tools.

Use Publication 4696 PR - VITA/TCE Puerto Rico Resource Guide and Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return Form 1040 or Form 1040-SR to answer the questions.

1.1 Lauren was a resident of Puerto Rico during 2023. She is single and under 65 years of age. She works as a U.S. government employee and her salary was $34,000. She also received income of $6,000 from a part-time job in Puerto Rico not subject to U.S. tax. Use the worksheet on page 3 in Publication 1321 to calculate the allowable portion of the standard deduction.
What is the allowable portion of the standard deduction that Lauren can claim?
a. $11,773 ANSWER
b. $13,850
c. $15,700
d. $25,900

1.2 German and Elena were residents of Puerto Rico in 2023. They are both over 65 years old and file a joint return. German is retired from the U.S. Postal Service and Elena is retired from the U.S. Veterans Affairs. Their taxable pensions were $29,000 and $42,000, respectively.
What is German and Elena’s standard deduction?
a. $25,900
b. $27,700
c. $29,200
d. $30,700 ANSWER

1.3 Marco is 40 years old, qualifies to file Head of Household, and a resident of Puerto Rico during 2023. He informed you that he received the following sources of income: $12,500 for a job he performed in the state of Florida; $23,200 received from the federal government for services performed in Puerto Rico. He also received $6,300 from a part-time job in Puerto Rico that is exempt from federal income tax. Use the worksheet on page 3 in Publication 1321 to calculate the allowable portion of the standard deduction.
What is the allowable portion of Marco’s standard deduction?
a. $13,850
b. $15,700
c. $17,680 ANSWER
d. $20,800

1.4 Camilo is a bona fide resident of Puerto Rico, who received Social Security benefits and pension income from the University of Puerto Rico.
Does Camilo have U.S. source income?
a. Yes, he has U.S. source income. ANSWER
b. No, he does not have U.S. source income.

1.5 Paloma is single and received unemployment benefits from the Puerto Rico Department of Labor reported on a Form 1099-G.
What is the factor determining source of income for unemployment?
a. Residence of the payee
b. The location of the payer
c. Unemployment compensation is generally considered sourced where the taxpayer performed the underlying services ANSWER
d. None of the above

Level I PR Test Scenario 1 Sol Fuente – Taxpayer Documents:
• Completed Intake/Interview and Quality Review Sheet
• Form 499R-2/W-2PR, Puerto Rico Withholding Statement

Level I PR Test Scenario 1 Sol Fuente – Interview Notes:
• Sol Fuente is employed as an executive secretary.
• Sol is divorced with two children. Delmar is 7 years old and Lucas is 16 years old.
• Sol paid all the cost of keeping up the home and more than half the support for her children.
• Social Security numbers: Sol Fuente 133-00-XXXX, Delmar Gracia, daughter, 599-00-XXXX and Lucas Gracia, son, 598-00-XXXX.
• If she is entitled to a refund, Sol would like to receive it via direct deposit.
• Sol has a checking account from Any Town Credit Union Account Number: 54321 Routing Number: 123456789.
• Sol has an Identity Protection Personal Identification Number (IP PIN): 987654.

Level I PR Test Scenario 1 Sol Fuente – Test Questions:
Based on the information provided by Sol Fuente, complete Form 1040-SS or Form 1040-SS (SP) and the required forms and schedules to answer the following questions. You are a volunteer at site S21014444.

1.6 What is the amount of the Additional Child Tax credit on line 19, Part II, in Form 1040-SS (SP)?
a. $0
b. $3,000
c. $3,200 ANSWER
d. $6,000

1.7 What filing status can Sol use?
a. Head of Household ANSWER
b. Married Filing Jointly
c. Married Filing Separately
d. Qualifying surviving spouse

1.8 Sol can file Form 1040-SS (SP) or Form 1040-SS to claim the Additional Child Tax credit.
a. True ANSWER
b. False

1.9 The IRS issues an Identity Protection Personal Identification Number (IP PIN) to protect and confirm taxpayer identity when submitting a tax return.
Should the IP PIN be included on the Form 1040SS or Form 1040-SS (SP)?
a. Yes ANSWER
b. No

1.10 Sol can claim up to $1,600 per child or the Social Security and Medicare taxes withheld from his wages, whichever is lower.
a. True ANSWER
b. False

Level I PR Test Scenario 2 Hernan Cortez and Luisa Oviedo – Taxpayer Documents
• Completed Intake/Interview and Quality Review Sheet
• Form 499R-2/W-2PR, Puerto Rico Withholding Statement

Level I PR Test Scenario 2 Hernan Cortez and Luisa Oviedo – Interview Notes
• Hernan Cortez and Luisa Oviedo are married and bona fide residents of Puerto Rico.
• Hernan and Luisa’s SSNs are 581-00-XXXX and 582-00-XXXX respectively.
• Luisa is a housewife who did not receive income during the year.
• Hernan is an accountant for the Puerto Rico Tourism Company; his wages for this year were $53,000.
• His contributions for the Social Security and Medicare were $3,286 and $768.50, respectively.
• They have two children under 17 and an older child Henry, who is permanently and totally disabled.
• Hernan and Luisa would like a direct deposit to their checking account 57892; routing number 02190XXXX.
Name Date of Birth Relationship
Edward Cortez 3-12-2016 Son
Maria Cortez 3-12-2016 Daughter
Henry Cortez 6-01-2004 Son

Level I PR Test Scenario 2 Hernan Cortez and Luisa Oviedo – Test Questions:
1.11 What filing status can Hernan Cortez and Luisa Oviedo claim on their return?
a. Single
b. Married Filing Jointly ANSWER
c. Head of Household
d. None of the above

1.12 How many dependents are eligible for the Additional Child Tax Credit (ACTC)?
a. 0
b. 1
c. 2 ANSWER
d. 3

1.13 How much is the Additional Child Tax Credit that Hernan and Luisa are entitled to receive?
a. $0
b. $3,000
c. $3,200
d. $4,055 ANSWER

1.14 The modified adjusted gross income for Hernan and Luisa is within the income limit to claim the Additional Child Tax Credit.
a. True ANSWER
b. False

1.15 Which form should be completed by Hernan and Luisa to claim the Additional Child Tax Credit?
a. Form 1040NR and Schedule 8812
b. Form 1040 SS and Schedule 8812
c. Form 1040 SS (SP) or Form 1040-SS ANSWER
d. Any of the above.

2023 Level I Puerto Rica Test 100% Pass Proof:

1.12 How many dependents are eligible for the Additional Child Tax Credit (ACTC)?
a. 0
b. 1
c. 2
d. 3 ANSWER Incorrect (The correct answer is c. 2) and that makes it 100% Pass.

2023 Puerto Rico VITA Certification Test Level II:
The first five questions are designed to measure key competencies related to figuring the allowable portion of itemized deductions to U.S. income; calculating the source of pension income for service performed in the U.S.; and determining the taxable portion of Social Security benefits.

Read each scenario carefully and use your reference materials Publication 4696 (PR) VITA/TCE Puerto Rico Resource Guide and Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return) to answer the questions. Round all fractions to four decimal places.

2.1 Adan and Eva are both under age 65 and bona fide residents of Puerto Rico who file a joint return. Adan had self-employed gross income of $30,000 from his business in Puerto Rico. Eva works for the federal government and her salary was $45,000. Before calculating the allowable portion, they had the following eligible itemized deductions:
● Home mortgage interest: $8,500
● Real estate taxes: $1,400
● Charitable contributions: $750
What is the amount of calculated allowable itemized deductions that can be claimed?
a. $0
b. $6,390 ANSWER
c. $27,700
d. $29,200
45000 Fred Gov. Income/7500 All Source Income=0.6
8500x0.6=5100
1400x0.6=840
750x0.6=450 (Total 6390)

2.2 Calculate the allowable standard deduction for Adan and Eva (see exercise 2.1 above). Based on these calculations, the allowable standard deduction is higher than the allowable itemized deductions.
a. True ANSWER
b. False
27700x0.6=16620

2.3 Franklin is a single taxpayer, 63 years old, and a bona fide resident of Puerto Rico with no dependents. Franklin received a Form SSA-1099, Social Security benefits, showing $26,700 in box 3. He did not receive any other income. Use Publication 4696(PR) Social Security Benefits section as your reference materials. Is any part of his Social Security benefits subject to U.S. income tax?
a. Yes
b. No ANSWER

2.4 In 2023, Alex, 85 years old, resident of Puerto Rico, received $26,000 from his U.S. Civil Service pension. The benefits of this pension are attributed to a 25-year career with the federal government, in the state of New York.
Alex can claim a Foreign Tax Credit on Form 1040 for the taxes paid to New York.
a. True
b. False ANSWER

When claiming a foreign tax credit, you must complete Form 1116, Foreign Tax Credit. See Topic no. 856 for more information about the foreign tax credit.

2.5 Santiago is single, 70 years old and received Form SSA-1099 for 2023, which shows benefits of $19,000 in box 5. He also received the following income during 2023:
● Taxable pension from the University of Puerto Rico of $37,000
● Salary of $5,000 from a company in Puerto Rico
● Taxable IRA distribution of $4,000 from a bank in Puerto Rico
Using Publication 915, Worksheet 1 and VITA/TCE Practice Lab https://vita. taxslayerpro.com/, what amount of his Social Security benefit is taxable to the United States?
a. $0
b. $16,150 ANSWER
c. $17,200
d. $19,000
19000+37000+4000=60000
19000+3700+4000+5000=65000
0.9231

Level II PR Test Scenario 1: Carolina Vigo – Taxpayer Documents:
● Completed Intake/Interview and Quality Review Sheet

● Form CSA 1099-R

● Form SSA-1099

Level II PR Test Scenario 1 Carolina Vigo – Interview Notes:
● Carolina Vigo is 70 and was born on January 2, 1953.
● Carolina’s SSN is 123-00-XXXX and her grandson Lucas Cruz’s SSN is 124-00-XXXX.
● Her grandson, Lucas, was born on July 23, 2007, has lived with her for the last three years and qualifies her to file as Head of Household.
● Carolina pays the total cost of keeping up a home for herself and her grandson.
● She does not want to contribute to the presidential election campaign.
● If a refund or balance is due, Carolina would like a direct deposit to or direct debit from her checking account 67890; routing number 021904512.
● Her address and SSN are correct and were validated during the interview.
● Carolina is retired from the Civil Service Retirement System. She has a single life annuity and began receiving retirement benefits on January 5, 2010. The pension is attributed to services performed in New York. Carolina moved to Puerto Rico in 2010.
● Carolina receives Social Security benefits.
● According to the Simplified Method, Carolina can recover $2,667 of the cost of her pension tax free annually

Level II PR Test Scenario 1 Carolina Vigo –Test Questions:
Please complete Form 1040, Publication 915, Worksheet 1, and the child tax worksheet to answer the following questions. You are a volunteer at site S21014444.
2.6 After considering the cost recovery of tax free amount; what is the taxable portion of Carolina’s pension?
a. $0
b. $15,000
c. $36,033 ANSWER
d. $38,700
2.7 Can Carolina claim a foreign tax credit for the taxes paid to Puerto Rico on her pension attributed to services she performed in New York?
a. Yes
b. No ANSWER

Foreign tax credit (IRS) – Question 2.7:
● If you must report income from Puerto Rican sources on your U.S. income tax return, then you can claim a foreign tax credit for income taxes paid to Puerto Rico on the same income.
● To calculate your foreign tax credit, you must reduce the income taxes paid to Puerto Rico by the amount of income taxes allocable to excluded Puerto Rican source income.
● When claiming a foreign tax credit, you must complete Form 1116, Foreign Tax Credit.
● See Topic no. 856 for more information about the foreign tax credit.
● For more information about how to allocate deductions and credits with respect to excluded income as well as how to determine if you're a bona fide resident, refer to Topic no. 901, Publication 570, and Publication 1321.

2.8 What is the amount of Carolina’s standard deduction?
a. $4,000
b. $18,650
c. $22,650 ANSWER
d. $27,700
2.9 Carolina can claim the Child Tax Credit.
a. Yes ANSWER
b. No
2.10 The taxable amount of Carolina’s Social Security benefit (from the Publication\ 915 worksheet) is $12,871.
a. Yes ANSWER
b. No

Level II PR Test Scenario 2: Pedro Viera and Valeria Real – Taxpayer Documents:
● Completed Intake/Interview and Quality Review Sheet

● Forms W-2 for Pedro Viera and Valeria Real

Level II PR Test Scenario 2: Pedro Viera and Valeria Real – Interview Notes:
● Pedro Viera and Valeria Real are married, filing a joint return, and have two dependent children under the age of 17.
● Valeria’s mother, Sofia Real, lives with them. She is permanently and totally disabled. Sofia received Social Security benefits that are not taxable and were not used for her support.
● The children qualify for claiming both the non refundable and refundable child tax credit.
● The Social Security number for Pedro is 134-00-XXXX (date of birth: 09/23/1982) and for Valeria is 135-00-XXXX (date of birth: 01/25/1980).
● They have a daughter, Crystal (date of birth: 05/13/2012; SSN: 136-00-XXXX), and a son, Louis (date of birth: 02/15/2014; SSN: 137-00-XXXX). Sofia Real’s SSN is 138-00- XXXX (date of birth: 03/30/1948).
● They do not itemize deductions.
● The Puerto Rico tax liability for 2023 is $ 6,200.
● Pedro and Valeria provided the entire cost of maintaining the household and all the support for their children and for Sofia.
● If a refund or balance is due, Pedro and Valeria would like a direct deposit to or direct debit from their checking account 53890; routing number 06790XXXX.

Level II PR Test Scenario 2: Pedro Viera and Valeria Real – Test Questions:
Complete the Form 1040, schedules, and worksheet based on the information provided by Pedro and Valeria, complete Form 1040, the required forms and schedules to answer the following questions. You are a volunteer at site S21014444.
If you are using the Link & Learn Taxes Practice Lab, when entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice. In classroom situations, replace the Xs with the information provided by your instructor.
2.11 Pedro and Valeria’s total income shown on line 1a of Form 1040 is:
a. $0
b. $76,912
c. $86,912 ANSWER
d. $93,206
2.12 Pedro and Valeria are eligible to claim which of the following non-refundable credits on their 2023 tax return?
a. Other Dependent Credit
b. Foreign tax credit
c. Child Tax Credit
d. All of the above ANSWER
2.13 What is the amount of Foreign Taxes that should be entered on line 8 in Form 1116?
a. $0
b. $2,750
c. $4,500
d. $ 6,200 ANSWER
2.14 Which of the following items are included in the total payments on Pedro and Valeria’s tax return?
a. Federal income tax withheld from Form W-2
b. Additional child tax credit
c. Child Tax Credit
d. Both a and b ANSWER
2.15 What is the taxable income reported on Form 1040?
a. $0
b. $51,012
c. $59,212 ANSWER
d. $72,958

2023 Level II Puerto Rico Test Pass Proof:

FILE FREE IRS TAX EXTENSION FREE FILE IRS FORM 4868;

2022-10-10T19:17:00.024-07:00

IRS File And e-File IRS Form 4868 For FREE –Instructions:

Number 1 Choice Filing Online IRS Form 4868: Using FREE TAX EXTENSION. Let us help you file your Form 4868 for free. You File, You e-File for FREE.

Taxpayer Information IRS Form 4868 Tax Year 2022 20% Completed: Complete your tax extension online in less than 3 minutes Using our clearly accessible interface you can extend the deadline for submitting your tax returns by 6 months.

Taxpayer Details IRS Form 4868 Tax Year 2022 50% Completed: Pay your tax owed balance to the IRS smoothly Estimating your tax payments can be daunting, but our customer service specialised team are there to help you;

Taxpayer Filing IRS Approved IRS Form 4868 Tax Year 2022 100% Completed: Avoid costly late filing and late payment penalties using our user-friendly system, you can extend the deadline for submitting your tax returns to Oct 16th;

FACILITATED SELF ASSISTANCE (FSA) FREE FILE VITA INSTRUCTIONS;

2022-10-09T18:25:00.103-07:00

IRS Remote File And e-File Free Facilitated Self – Assistance VITA Instructions:

Number 1 Choice Remote Online Filing: Using OnLine Taxes. Let us help you file your own taxes for free. You File, You e-File.

Note:
Our United Way of Siouxland VITA Site Identification Number (SIDN) S26063046 must be included for Free Return.

• OnLine Taxes.
• Eligibility Requirements:
• Any age;
• Adjusted Gross Income (AGI) under $73,000, OR;
• Eligible for EITC, OR;
• Active Duty Military and under $73,000 AGI;
• Free state return if you qualify for a free federal return;
• Log-in Link:
Step 1. – Create OLT ONE Account. You will see our SIDN: S26063046 already entered.
Step 2. – Start new return;
Step 3. – Prepare Federal Return;
• Enter Income W-2 Form;
• Enter Other Income;
• Enter Deductions for Adjusted Gross Income;
• Enter Standard Deduction;
• Enter Payments;
• Enter Credits;
• Enter Direct Deposit Information if Refund;
• Enter Payment Voucher Amount You Owe;
Step 4. – Prepare State Return;

Number 2 Choice Remote Online Filing: Using TaxSlayer Pro Online. Let us help you file your own taxes for free. You File, You e-File, just by hitting the Transmit button.
For Tax Questions:
A Certified Tax Preparer will assist you with TaxSlayer Pro Online software questions and tax preparation questions via:
1. Phone: call 712-252-1861 x108
2. Email: cfs@centerforsiouxland.org
3. Zoom: Call 712-252-1861 x108 and we will set up a Zoom meeting between you and a Certified Tax Preparer.

For TaxSlayer Pro Software Eligibility Requirements:
1. Adjusted Gross Income (AGI) under $73,000.
2. Free state return if you qualify for a free federal return.
3. Foreign Students and Puerto Rico filers access to prepare and e-file 1040-NR and 1040-PR returns

Log-in Link to TaxSlayer Pro Online::
1. Go to https://myfreetaxes.com/ by clicking on myfreetaxes.
2. Click on the picture “File My Own Taxes.” Answer the 3 questions. Click “File Now.” You will be transferring to TaxSlayer Pro Online using our special referral link so you can file your taxes for free and transfer e-File to IRS for free.
3. If you have previously filed your taxes using TaxSlayer and already have an account, you will be able to use that account with the link above to file your taxes. If not create a new account.

What You Will Need:
1. Income statements like W-2s or 1099s;
2. Adjustments to income;
3. Dependent and spouse information, if applicable;
4. Prior Year AGI or
Prior Year Self-Select PIN.

File your taxes for free. Choose the filing option that works best for you.
1. File My Own Taxes OR
2. Have My Taxes Prepared for Me.
MyFreeTaxes File By Myself.
At the site above, answer three simple questions:
1. Did you earn less than $73,000 in 2022?
2. What is your ZIP code?
3. Do you have income from self-employment?

After answering 3 questions hit the FILE NOW button. And you will be redirected to TaxSlayer VITA/TCE self-prep kiosk.

Welcome to the TaxSlayer VITA/TCE self-prep kiosk:
• No current year preparation or e-File Fees;
• Current year states, unlimited;
• Access to prepare and e-file 1040-NR;
• Access to prepare and e-file 1040PR;
• For assistance while completing your return, please contact the free tax assistance program where you received the referral link to this software. They have IRS-certified specialists available to assist you.
• Click the Continue button to create a new account or login with an existing account.

This is a great opportunity if you:
1. Are filing 2022 tax return;
2. Are comfortable using tax software;
3. If you have previously filed your taxes using TaxSlayer and already have an account, you will be able to use that account with the link above to file your taxes. If not create a new account.

Hero Wars – Online Game Play and Win Prizes – a Game You can’t lose – Dozens of Game modes await;

2022-07-14T17:47:00.027-07:00

Challenge yourself in ruthless battles against other players.

Take part in battles throughout our heroes’ adventures and complete an enormous number of levels.

Discover the world of the enormous Titans. Feel the full might of the elements as you command different giants battling on your side in the large-scale clashes of another world.

Learn the secret history of the Dominion. Discover the world of the CAMPAIGN TITANS ARENA. MULTIPLE WAYS TO PLAY.

CHOOSE YOUR HERO: WHETHER YOU LIKE TO DIVE STRAIGHT INTO THE FRAY, SUPPORT YOUR TEAMMATES, OR SOMETHING IN BETWEEN, THERE'S A SPOT FOR YOU.

Feel the full might of the elements as you command different giants battling on your side in the large-scale clashes of another world.

SLAY WITH STYLE MAKE IT PERSONAL BY CHANGING UP THE LOOK OF YOUR FAVORITE CHAMPIONS WITH SKINS.

Take part in battle, having put together your own unique party of heroes and conquer the top of the rankings, showing everyone you're the best.

Click to Play the Online Game

Start Your Career at Sonic! The largest independent internet service provider in California, serving homes and businesses for over 25 years;

2022-07-12T21:56:00.042-07:00

Start Your Career at Sonic! Sonic is hiring – Jobs in California

Sonic Company provides packaged subscriptions for Internet connectivity, web hosting, and television:

Sonic Company ADDRESS: 2260 Apollo Way Santa Rosa, CA 95407, Phone: 888-766-4233.

Field Sales 16 positions: – NOW OFFERING $2,500 SIGNING BONUS!

You get: $2,500 Sign On Bonus! Base + Commission + Bonus! Full Benefits & 401K!

For an outstanding Entry Level Sales Representative opportunity with no end to what you can achieve, think Sonic Internet.

We are seeking the next generation of sales professional superstars for our Entry Level Sales representative position.

Not only will you hone your skills as a sales representative, but we will also help you become a top-notch sales representative.

We want someone who is able to handle challenges and overcome obstacles. So, if you are up for the challenge, keep reading.

What Does the Day of an Entry Level Sales Representative look like?

Connect with prospective customers about our products and services;

Apply knowledge of products to best meet customer needs;

Strategically network and expand your customer base;

Confidently provide focused customer service;

Track and monitor performance against team and company metrics;

What are the requirements for this position?

Self-motivated/self-starter, hard worker, persistence, resilience, and a go above and beyond attitude;

Proven ability to achieve sales quotas;

Possess persuasive selling skills and knowledge;

Although having experience is a plus, if you believe you will succeed in this position then we want to talk to you!

Why you should take the next steps?

At our company we believe in our employees, we do what we can to help you succeed. You will be a part of an amazing team that strives to always do better. We all want the same thing, to love what we do and feel purpose in our jobs!

Some of our benefits include:

Being a part of a great company culture that values their employees;

We offer training if necessary;

You will have the opportunity to grow within the business and make a competitive salary;

Does this sound like the job you are looking for? If so, apply now to be a part of our sales team!
Apply for this Job Now.

Dotdash Meredith Careers – Content Update Editor Job, for Investopedia;

About Your Role:

Investopedia is looking for a remote editor to join our growing team. As an editor, you will revise and augment existing articles to improve the user experience and drive additional traffic.

This is a remote position, but applicants must live within the United States and be able to commit at least 20 hours per week (with a maximum weekly commitment of 40 hours).

The successful candidate must provide clips that demonstrate their expertise with relevant subject matter.

About Your Contributions:
• Review existing articles on a wide variety of topics and revise content in accordance with project instructions.
• Identify and update outdated material, including noting where visuals or videos are outdated or no longer accurate.
• Identify opportunities to proactively improve content by restructuring, strengthening sourcing, incorporating visual elements, and more.

About You:
• At least two years’ experience writing or editing in the business and finance sectors (ideally consumer-friendly, actionable articles).
• Extensive knowledge of one or more of the following:

Technical analysis,

Futures and Commodities trading,

Forex trading,

Options strategies,

Fixed income strategies,

Portfolio diversification,

Dividend investing,

Value investing, and

Fundamental analysis.

• Comfortable with content management systems.
• Detail-oriented, deadline-focused, and independent.
• Experience as a financial adviser, banker, mortgage broker, or similar profession a major plus.
• Bachelor’s degree required; advanced degree a plus.
• Relevant professional certifications (CFA, CPA, CMT) also a plus.

About Us:

Dotdash's vibrant brands help over 100 million users each month find answers, solve problems, and get inspired.

Dotdash is among the largest and fastest-growing publishers online and has won over 80 awards in the last year alone.

Dotdash brands include Verywell, Investopedia, The Balance, The Spruce, Simply Recipes, Serious Eats, Byrdie, Brides, MyDomaine, Lifewire, TripSavvy, Liquor.com, and TreeHugger.

Please note that any correspondence with a member of the Dotdash recruiting team will come from a @dotdash.com or a notification@jobvite.com account belonging to a Dotdash Recruiter.

If you are in conversations about a job opportunity and wish to confirm its validity, please reach out directly to security@dotdash.com.

Required Four Clips Attachments:

Please attach four clips for Investopedia to review that demonstrate your subject matter expertise and writing skills; links and pdfs are both acceptable.

Apply for Free

Back to Current Openings

Add Resume and Cover Letter:

Add Resume:

Add Cover Letter:

Chabot College SOFTWARE SPECIALIST Certificate of Achievement (CA)

2022-07-06T21:35:00.041-07:00

Chabot College Digital Media Courses:

DIGM 15 - Web Design Fundamentals ( 3.00 Units );

DIGM 16 - Interactive Web Design ( 3.00 Units );

DIGM 17 - JavaScript for Designers ( 3.00 Units );

Optional Textbooks for Chabot College Digital Media Courses (Free Downloads):

Web Programming with HTML5, CSS, and JavaScript 2019 Paperback: 678 pages $89.95 ISBN-13: 978-1284091793 for undergraduate, client-side web programming course by John Dean PhD Associate Professor Computer Science Free Download.

Web Programming with HTML 5, CSS, and JavaScript is written for the undergraduate, client-side web programming course. It covers the three client-side technologies (HTML5, CSS, and JavaScript) in depth, with no dependence on server-side technologies. One of the distinguishing features of this new text is its coverage of canvas, one of the most important new features of HTML5.

Web Programming with HTML5, CSS, and JavaScript by John Dean Associate Professor PhD – CLICK FOR FREE DOWNLOAD (P.S. You saved $89.95).

Chabot College Tax Preparer (Certificate of Achievement) and Marketing (Certificate of Achievement);

2022-06-22T19:07:00.070-07:00

Chabot College Tax Preparer Business Courses:

BUS 3A Taxation of Individuals;

BUS 3B Taxation of Business Entities;

BUS 6 Accounting Ethics;

BUS 7 Accounting for Small Business;

BUS 8 Payroll Accounting;

BUS 92 Excel Spreadsheets for Accounting;

BUS 93 QuickBooks;

BUS 3A - Taxation of Individuals 3.00 Units:

Course Filing the individual return Form 1040 (Federal) and Form 540 (CA) Table of Contents:

Available filing statuses for taxpayers;

Dependency exemptions;

Standard deduction;

Gross income;

Business Income and expenses (Schedule C);

Itemized deductions;

Capital Gain/Loss;

Tax credits;

Gains and losses in sale, exchange, and disposal of property;

Differences between California and Federal income tax rules and regulations;

Textbooks (Typical):

Spilker (2020). Taxation of Individuals McGraw Hill.

Whittenberg and Altus Buller (2018). Income tax fundamentals (41/e) South-Western College Publications (Cengage).

Spilker Ph.D. Taxation of Individuals and Business Entities 2020 11th Edition Hardcover: 1264 Pages 978-1259969614 Publisher: Publisher: McGraw Hill; 11th edition $29.63 Used on Amazon.

CLICK FOR FREE DOWNLOAD

McGraw-Hill Taxation series is now the most widely adopted code-based Tax title across the country instructors. The clear – organized delivery of content with tax code updates, is used by more than 600 schools. Author Brian Spilker teaches taxation at Brigham Young University where he received both B.S. and M.A.cc degrees. After work experience at a major tax firm, he earned his Ph.D. at the University of Texas at Austin.

Whittenburg Ph.D. Income Tax Fundamentals 2011 29th Edition Whittenburg 836 Pages 978-0538469197 Publisher: South-Western College $4.95 on Amazon.

CLICK FOR FREE DOWNLOAD

Self-study problems and solutions encourage students to work in a step-by-step manner to build on concepts gradually. Strong end-of-chapter reinforcement, including online interactive quizzes, further prepares students for career success.

Chabot College Marleting Business Courses:

BUS 34 Introduction to Advertising 3 Units;

BUS 36 Introduction to Marketing 3 Units;

Textbooks (Typical):

Arens Contemporary-Advertising and Integrated Marketing 13th Edition 816 Pages.

Tanner Ph.D Principles of Marketing V2.0 2013 359 Pgs 978-1453344989 Publisher FlatWorld Knowledge $64.40.

Tanner Ph.D Principles of Marketing V2.0 2013 PDF Free Download. You Saved $64.49.

Tanner Ph.D Principles of Marketing V2 CLICK FOR FREE DOWNLOAD.

978-0073530031 Publisher: McGraw-Hill Education; 13th edition (January 15, 2010).Free Download.

CONTEMPORARY ADVERTISING, 13e, is one of the best-selling advertising texts in this field. Known as the “coffee table book” for Advertising, it is known for its current examples, the author’s ability to pull from real-world experiences, and the clear writing style. Taking a comprehensive view of the industry, this text presents advertising from the creative stand-point and Arens draws from his own industry experience to lend life to the examples. Author Bill Arens continues to address the importance of Integrated Marketing Communications (IMC) in the field of Advertising and how it impacts advertising strategy through featured examples of IMC campaigns.

Tanner Ph.D Principles of Marketing V2.0 2013 359 Pgs 978-1453344989 Publisher FlatWorld Knowledge $64.40.Free Download.

Options Trading Rules How To Spot a Market Reversals and Trade It!

2022-06-22T18:44:00.029-07:00

Bloomberg Options Trading With Charts To Maximize The Return:

Bloomberg Trading Boklet:

Bloomberg Trading Boklet Table of Contents

Sign Up Instructions Pg. 2

Bloomberg News Pg. 13

Equity Markets Pg. 20

Bloomberg Trading Boklet Free Download:

CLICK FOR FREE DOWNLOAD

Options Trader Workstation (TWS) Interactive Brokers Users' Guide and YouTube Getting Started;

Trader WorkStation (TWS) Users’ Guide –Table of Contents:

Downloading and Installing Trader Workstation (TWS):
TWS Installation Instructions:

Trader Workstation (TWS) Login Screen:
We strongly recommend that you open a paper trading account as described in Opening a Paper Trading Account to familiarize yourself with Trader Workstation’s many features without accidentally submitting a trade.
Opening a Paper Trading Account:

Trader Workstation (TWS) Order Entry Window: Getting Started with the Order Entry Panel;

Trader Workstation (TWS) Activity Panel:
Activity Panel comprises the Orders, Trades, Portfolio and Trades Summary windows.

Classic Trader Workstation (TWS) Spreadsheet Layout:

Trader Workstation (TWS) Layouts in Mosaic:
Simplify your trading interface with custom-designed layouts. Quickly create a workflow-based or instrument-focused layout using a pre-defined layout from our comprehensive library. Create as many layouts as you need, and access them easily from the quick-click tabs along the bottom of TWS.

Trader Workstation (TWS) Panel Icons.

Trader Workstation (TWS) Grouping Panels.

Trader Workstation (TWS) Expanding the Display.

Trader Workstation (TWS) Accessing Help.

Award-winning platforms powerful enough for professional traders but designed for everyone. Trade globally in stocks, options, futures, bonds, and more from a single unified platform. Innovative Technology. Low Cost and Best Execution. Real-Time Risk Management. Traders' Academy · Options Trading · Stock Trading · Best for Advanced Traders · Layout and Contents

Trade WorkStation (TWS) Users’ Guide 2019 – CLICK FOR FREE DOWNLOAD.

Options Trading Skills - Introduction to Orders and Orders Execution:

Options Trading Skills - Instructions How to Trade Orders:
Trading Skills and Essentials
Trading Order Types and Processes
Overview
Execution

Understanding Order Execution

Open Order

Overview

Market Order vs. Limit Order

Limit Order vs. Stop Order

Buy Limit Order

Buy Stop Order

Stop-Loss Order

Determining Where to Set Your Stop-Loss

Stop-Limit Order

Stop-Loss vs. Stop-Limit Order

Buy Limit vs. Sell Stop Order

Take-Profit Order

Order Duration

Overview

Time In Force

Day Order Definition

Good 'Til Canceled (GTC)

Job Opportunities, Insurance Careers, Work at Mutual of Omaha!

2022-06-16T19:45:00.015-07:00

Mutual of Omaha Job Opportunities:

Explore Mutual of Omaha Job Openings:

Hundreds of Annuity sales jobs for immediate start. Apply online today with 1 click.

Find Annuity sales jobs - Fremont; +1000 jobs available. Easy application. Get more details. Apply to:

Immediate start jobs ·

No experience jobs ·

Part time jobs ·

Full time jobs ·

Annuity Sales Jobs ·

Immediate Start - up to $32.00/hr. – Apply Now.

3 Urgent Openings - up to $170.00/day – Apply Now.

High Paying Jobs - up to $42.00/hr. – Apply Now.

16 Best Freelance Websites to Find Work in 2022!

2022-06-12T16:35:00.009-07:00

Finding freelance work doesn’t have to be complicated.

How We Chose Top Freelance Websites:

To ensure that each freelance website on our list is reliable and trustworthy, we weighed in several factors, such as:

Terms and conditions: Chosen freelance websites have well-documented terms and conditions that protect both freelancers and employers on said platforms.

Customer support: Each freelance site provides customer support to guide users and resolve any disputes.

Payment and withdrawal methods: Local and global freelancers can receive payment from freelance websites through multiple options, such as bank transfers and electronic payments..

Sales Work from Home Griffin Agency Denver, CO 80229, USA;

2022-05-27T15:53:00.029-07:00

Sales Work from Home – Remote Full-time or Part-time;

– EARNINGS POTENTIAL:

Our typical broker working full-time in the field goes on ten appointments per week, sells five policies, and earns a commission of around $500 per sale. That adds up to around $2,500 a week, $10,000 a month, $120,000 a year.

APPLY NOW

– Your Work from Home Full-Time Sales Position Job:

We at the Griffin Agency are looking for hard working, enthusiastic, career-minded, self-motivated individuals who would like to make an impact helping families protect their futures with life insurance and other financial products. If you are new in the field, we will provide you the best training in the industry.

If you are experienced in business management and marketing, we will give you the support you need to ensure your success.

This sales position involves Warm Market Leads, Client Requested Follow Up, while working from home. We work exclusively with clients who asked for our help.

– Your Work from Home Full-Time Sales Position Job and How It Works:

Our central office sends letters to recent home buyers, inviting them to apply for home mortgage protection insurance. These prospects are requesting information to help them protect their assets, their income or their retirement!

You contact these Warm Market Leads and qualify them over the phone. We meet them virtually, explain their options, and help them through the application process.

Performance based promotions every 2 months;

A+ leads with an appointment setting ratio of 70%;

A selling system that is validated by agents nationwide;

A training system that offers you support from day one;

A flexible schedule that allows you to work on your own time;

Access to REAL time leads and customized mailings specific for YOU, so that you can spend your time making sales and not creating leads.

– Your Remote Sales Job Advantages:

Work from home;

Set your own full-time or part-time schedule and work the hours that fit into your busy life.

Travel to our national events where you’ll learn, collaborate with other professionals, and have fun!

– OUR PRODUCTS WE OFFER:

Simplified life insurance policies; require no medical underwriting and pay the client’s mortgage in the event of death to keep the family in their home.

Return-of-premium policies; that return every penny of premium to clients who survive their policies—we call it “money-back” life insurance.

Whole life insurance and annuities;

As a broker, you’ll match clients to the products that best fit their needs from a number of insurance carriers.

Live Chat Assistants for TikTok accounts - $30/hr Online/Remote Position and Flexible:

Your Job Title: Live Chat Assistant for TikTok accounts.
Send TikTok DM’s - $30/hr Flexible Online/Remote Position:
TikTok DM’s businesses are currently hiring new live chat assistants to reply to DM’s from customers on their TikTok accounts. TikTok Direct Messages jobs are done online remotely, and you only need a TikTok account, reliable access to the internet, and 20+ hours a week to work on this job.

Your Job Description:

Businesses are growing their TikTok accounts: TikTok is expanding the instant messaging features allowing potential customers to contact businesses through direct messages platform.

You will be provided with: Information on the business and answers to the most commonly asked questions.

You will then need to log on to the business’s TikTok account: And reply to customer questions through DM’s.

Contract length: No fixed term.

Pay Rate: $30.00 per hour.

Hours per week: 20 - 40 hours a week.

Location: Remote work online (United States preferred).

Skills/background needed:

Must have a device able to access TikTok.

Be able to work independently.

Ability to closely follow provided steps and instructions.

Have 20+ hours availability per week.

Reliable internet connection.

Live Chat Assistants for TikTok accounts are in huge demand worldwide right now.

If you can start right away, please apply below.

CLICK HERE TO APPLY

CONTACT US

$875 per week for posting photos on Facebook, Instagram, and Twitter;

Posting Photos on Facebook, Instagram, and Twitter for e-commerce companies;

We need your help and we're more than happy to pay you $875 per week for it.

As you may know, marketing products on social media is easier than doing it through any other platform.

That's why many e-commerce brands prefer this way of marketing their products.

But there's one small catch, this method is pretty time-consuming. That's why many businesses can't be able to do it by themselves.

So they hire ordinary social media users like you and me to manage all this stuff on behalf of them.

And today, they're hiring remote workers from United States.

Job title:

Earn $875 per week to manage posting photos on Facebook, Instagram, and Twitter for some e-commerce companies.

Job description:

The e-commerce companies that we work with are looking for 6 ordinary social media users from United States.

They expect you to promote their businesses through Facebook and Instagram using your phone or tablet. This way, you're helping them build brand awareness and getting the audience.

No need to learn social media advertising as the content will be 100% premade and provided to you by email.

And you're making $875 per week by just downloading and uploading premade content on these companies' social media accounts.

Pay:

$875 per week.

Location:

The companies are looking for people from United States.

Application deadline:

Midnight, June 6th, 2022

Requirements:

A reliable internet connection.

A smartphone or tablet to work.

12-14 hours of your free time per week.

Necessary Experience:

No previous experience is needed. You'll be provided with complete training on how to post photos on Facebook, Instagram, and Twitter with the right captions and the hashtags on each post.

Just hurry up and apply now if you want to end up on the final list of just 6 people.

CLICK HERE TO APPLY

Did You Run Out of Time to Apply for this Position?

We need more social media workers to start this week.

TO GET STARTED NOW CLICK HERE

Work from Home Start Right Away Good Paying Jobs: Your Initial Job Payment

How does $175.00 for a day's work sounds?
Becaouse we have an employer waiting to write your first $175.00 Cheque out for you and this is for online App review work with flexible hours.

Here are more details for you:

You'll be downloading and testing Apps made by small online businesses.

You'll be testing an App for managing personal finances.

You'll be testing a game apps.

We will be providing full applicable trainging for free.

Your new employer is waiting to sign off your first $175.00 Cheque.

Click the button below to confirm your new online position.

CLICK HERE TO APPLY

CREATE YOUR ACCOUNT:
To Apply for this Position, Please Register an Account using the Link below:
GET STARTED NOW

2021 VITA Advanced 94%, VITA International, 2021 VITA Military 93%, 2021 VITA Foreign Student 82%, and Circular 230 for Professionals.

2021-01-25T18:44:00.673-08:00

2021 Advanced Course Test Questions with Answers:
2021 Advanced Exam Certification 94% Pass Proof

Advanced Scenario 1: Test Questions Karen White;
1. What is the most beneficial filing status that Karen is eligible to claim on her 2021 tax return?
a. Single
b. Married Filing Separately
c. Married Filing Jointly
d. Head of Household

Question 1 — Explanation:
Can Married Filing Separately taxpayers qualify for another status?
Some married taxpayers may be considered unmarried even if they are not divorced or legally separated. Such taxpayers may be able to use the Head of Household filing status, which may result in a lower tax than Married Filing Separately.

2. Karen’s Economic Impact Payment (EIP3) must be included in her total income.
a. True b. False

No, the EIP3 payment is not includible in your gross income. Therefore, you will not include the payment in your taxable income on your federal income tax return or pay income tax on your payment. It will not reduce your refund or increase the amount you owe when you file your 2021 federal income tax return.

3. What amount may Karen deduct as a charitable contribution when filing her 2021 tax return?
a. $650 b. $600 c. $300 d.$0

Question 3 — Explanation: Charitable contribution deduction for individuals who don't itemize.
A charitable contribution is a donation or gift to a qualified organization. Charitable contributions new expanded tax benefit is to help individual 2021 tax filers, who does not itemize, including married individuals filing separate returns, can now (2021) claim a deduction of up to $300 for cash contributions made to qualifying charities during 2021. The maximum deduction is increased to $600 for married individuals filing joint returns.
Karen made a cash contribution of $650 to the Red Cross. She does not have to itemize for year 2021 and can claim a deduction of up to $300.

Form 1040 Line 12b Charitable contributions if you take the standard deduction and don’t itemize:
If you don't itemize deductions on Schedule A (Form 1040), you (or you and your spouse if filing jointly) may be able to take a charitable deduction for cash contributions made in 2021. Enter the total amount of your contributions on line 12b. Don't enter more than $300 ($600 if married filing jointly).

Retest Question 3. Karen’s deductible charitable contribution for 2021 does not reduce her adjusted gross income (AGI). The correct answer is True.
Small Capital Options Trader Rules Money Control and Power Your Trade:
Options are very different from Stock and therefore Options rules are very different as Options have a very small shelf life mostly a month comparted to Stocks.

Position Sizing

Setting the Holding Period

Pre-calculate Stops and Targets

Limit number of open trades 10 Contracts 3 and 3 and 4

Range Bound Trading

Mid-Morning Revesal

Late-Day Snapback

Afternoon Snapback

Options EveryDay Profits

Trade Morning Reversals and You'll be making Money just by watching the Clock. Every Day is Different, but watch the Clock for:

-Middle of the Morning Reversals

-Early Afternoon, Pullbacks or Breakouts

-End of Day Snapbacks

Gauge the Strength of the various Markets and know what it means to your Options trading:

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Books To Become an Options Trader:

Options as a Strategic Investment: Fifth Edition Hardcover — 2012 by Lawrence McMillan.
“Options as a Strategic Investment,” provides traders with practical option trading strategies designed to minimize risk and maximize profit potential. Inside this revised edition are scores of proven business-tested tactics for investing and the techniques for using index options and futures to protect one’s portfolio and improve one’s return; and the implications of the tax laws for option writers, including allowable long-term gains and losses.

$75.88 Hardcover Buy new on Amazon In Stock

Options as a Strategic Investment Fifth Edition STUDY GUIDE by Lawrence G. McMillam — Paperback Illustrated 2012.
Author Lawrence G. McMillan is a professional trader and the author of the bestselling Options as a Strategic Investment. He is recipient of Sullivan Award for his contribution to the growth and integrity of the US options markets. He is founder and president of McMillan Analysis Corporation. This Study Guide for the Fifth Edition will help you maximize your understanding of options, thereby increasing your profits.

$20.49 Paperback Buy new on Amazon In Stock

Option Volatility and Pricing: SECOND Edition Hard Cover — 2014 by by Sheldon Natenberg.
The bestselling “Option Volatility and Pricing” has made Sheldon Natenberg a widely recognized authority in the option industry. Option trading is both a science and an art and this book shows how to apply both to maximum effect. You'll learn how professional option traders approach the market, including the trading strategies and risk management techniques necessary for success.

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Fundamentals of Futures and Options Markets Pearson 9th Edition 2016 by John Hull Hardcover 624 pages Look inside Buy new: $207.98 In Stock ISBN 978-0134083247.
Fundamentals of Futures and Options Markets, simplifies the language for a less mathematically sophisticated audience. The Ninth Edition of Fundamentals of Futures and Options Markets offers easy-to-grasp introduction into financial mathematics. John Hull is the Maple Financial Professor of Derivatives and Risk Management at the Joseph L. Rotman School of Management, University of Toronto. He is an internationally recognized authority on derivatives and risk management with many publications in this area.

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Trading Options Greeks: How Time, Volatility, and Other Pricing Factors Drive Profits Second Edition by Dan Passarelli —Bloomberg Press 2nd edition Hardcover Illustrated 2012 368 pages ISBN 978-1118133163 In Stock Buy new: $52.50.
In the Second Edition of Trading Options Greeks, options trader Dan Pasarelli is offering fresh insights on option trading and valuation. He makes use of new charts and examples, and discusses how the proper application of the greeks can lead to more accurate pricing and trading. Dan Passarelli, is the author of the book Trading Option Greeks and founder of Market Taker Mentoring LLC an options education company that provides personalized one-on-one mentoring for option traders.

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The Option Trader's Hedge Fund: A Business Framework for Trading Equity and Index Options Paperback 1st Edition by Dennis Chen (Author), Mark Sebastian (Author) FT Press 2017; Paperback: 240 pages, ISBN-13: 978-0134807522, In Stock Buy new $43.49.
This book will show you how to master the five essential components of high-profit option trades and manage all your risks--including black swan risks. Dennis A. Chen is a hedge fund manager. He is the founder and Chief Investment Officer of Smart Income Partners, Ltd., a hedge fund specializing in generating income using index and equity options. Author Dennis A. Chen earned his MBA from The Wharton School of Business. He also holds a Master’s in Computer Science from Arizona State University and a Bachelor’s degree in computer science from the University of Texas. Author Mark Sebastian has a Bachelor’s of Science in finance from Villanova University of Pennsylvania. Mark Sebastian is the Founder of OptionPit.com.

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Options Trading Crash Course: The #1 Beginner's Guide to Make Money with Trading Options in 7 Days or Less! Paperback 112 pages Publisher eBookIt.com 2020 ISBN 978-1456636104 In Stock Buy new $9.95 Reviews 4.2, 239 Ratings.
Author Frank Richmond is an economist by trade. Frank found the options market too strong to ignore to make a successful investment. Everything Frank knows he learned through years of experience. Frank’s book “Options Trading Crash Course” is in a perfect position to help newcomers to learn options in an intuitive and easily understandable way.

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Options, Futures, and Other Derivatives 10th Edition Pearson 2017 by John Hull (Author) Hardcover 896 pages ISBN-13 978-0134472089 Buy new $261.32 College Graduate and Undergraduate levels.
John C. Hull is a Professor of Derivatives and Risk Management at the Rotman School of Management at the University of Toronto and holds an M.A. in Operational Research from Lancaster University and a Ph.D. in Finance from Cranfield University.

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Options, Futures, and Other Derivatives 9th Edition by John C. Hull (Author) 4.5-146 Ratings Buy use $227.34 Hardcover 896 pages ISBN 978-0133456318 PDF for Free Download.
Options Futures and Other Derivatives 9th Edition by Professor John C. Hull is designed for graduate courses in business, economics, financial mathematics, and financial engineering; for advanced undergraduate courses with students who have good quantitative skills; and for practitioners involved in derivatives markets. John C. Hull is a Professor of Derivatives and Risk Management at the Rotman School of Management at the University of Toronto.

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Options Trading Crash Course 2 Books in 1: A Guide for Beginners to Build Passive Income. Make Profit in the Next 60 Days Working from Home by Richman Publications Paperback – 2021 275 Pgs. 979-8780531500
Richman Publications is a company that brings together many of the most experienced American investors, founded in 2015 by five professional traders. Richman Publications hopes to reach all those people who are eager to take a step towards their financial freedom, to give them the knowledge to take that step in the most correct and profitable way possible.

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$25K Options Trading Challenge Second Edition: Proven techniques to grow $2,500 into $25,000 using Options Trading and Technical Analysis 2020 by Nishant Pant (Author) Paperback 161 Pgs. 979-8694166201 In Stock Buy new $24.99 4.4 star at 670 ratings Ships from Amazon.com Sold by Amazon.com
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OPTION TRADING STRATEGIES: HSBC InvestDirect Self-Directed Online Investing Services (Free Download).

OPTIONS and FUTURES: A Tutorial by CFA Institute Roger G. Clarke (Free Download).

Advanced Scenario 2: Test Questions Paul and Maggie Thomas.
4. What is the maximum amount Paul and Maggie are eligible to claim for the child tax credit?
a. $3,000 b. $3,600 c. $6,000 d. $6,600

The new law for 2021 is $3,000 per qualifying child ages 6 through 17, and $3,600 for qualifying children ages 5 and under. For eligible taxpayers the credit is fully refundable for 2021. Previously, the refundable portion was limited to $1,400 per child.

5. How much of the child care expenses can be used to claim the child and dependent care credit?
a. $3,500 b. $3,000 c. $1,500 d. $0

IRS Child and Dependent Care Credit Information:
The American Rescue Plan Act of 2021, was enacted on March 11, 2021, making the Child and Dependent Care credit substantially more generous and potentially refundable (up to $4,000 for one qualifying person and $8,000 for two or more qualifying persons) only for the tax year 2021, This means an eligible taxpayer can receive this credit even if they owe no federal income tax. Your federal income tax may be reduced by claiming the Credit for Child and Dependent Care expenses on your tax return.

Paul and Maggie are married and want to file a joint return. Maggie is a U.S. citizen and has a valid Social Security number. Paul is a resident alien and has an ITIN. Can Paul and Maggie claim Child Tax Credit for their two children?

Note: If you don’t have a ITIN by the due date of your return, you may not claim the CTC/ACTC on either your return. However, if you apply for an ITIN on or before the due date of your return and the IRS issues you an ITIN as a result of the application, the IRS will consider your ITIN as issued on or before the due date of your return.

What is the child and dependent care credit?
This credit allows taxpayers to reduce their tax by a portion of their child and dependent care expenses. The credit may be claimed by taxpayers who, in order to work or look for work, pay someone to take care of their qualifying person. A qualifying person is a Qualifying child under age 13.
Advanced Scenario 3: Test Questions Carol Wheeler
6. Form 8889, Part 1 is used to report HSA contributions made by _______________.
a. Carol b. Carol’s employer
c. Carol’s cousin d. All the above
Contributions to HSA: For an employee’s HSA, the employee, employer, or both may contribute to the employee’s HSA in the same year. Family members or any other person may also contribute on behalf of an eligible individual. Contributions to an HSA must be made in cash.

IRS 2021 changes: Contributions, other than employer contributions, are deductible on the eligible individual’s return whether or not the individual itemizes deductions. For 2021, if you have self-only HDHP coverage, you can contribute up to $3,600. If you have family HDHP coverage, you can contribute up to $7,200.

7. Carol is eligible to contribute an additional $________ to her HSA because she is age 55 or older. 1000

Health Savings Account (HSA) Deduction:
For 2021, the annual contribution limits on deductions for HSAs for individuals with self-only coverage is $3,600 (increase of $50) and $7,200 for family coverage (increase of $100). There is an additional contribution amount of $1,000 for taxpayers who are age 55 or older.

8. What is the total unreimbursed qualified medical expense reported on Form 8889, Part II?
a. $2,600 b. $2,900 c. $2,980 d. $3,105

Over-the-counter products and medications are now reimbursable without a prescription from HSAs accounts that means that additional items are now “qualified medical expenses” that may be reimbursed from HSAs accounts. And that is because the Coronavirus Aid, Relief, and Economic Security (CARES) Act modifies the rules that apply to tax-advantaged accounts like HSAs.

What is Form 8889, Part I used for?
Form 8889, Part 1, is used to report all HSA contributions and to compute the allowable HSA deduction. Contributions made by an employer are also shown in Part I, but are not included in the deductible amount. An HSA may receive contributions from any individual, including an employer or a family member.

What is Form 5498-SA?
The 5498-SA tax form is used to report contributions to a health savings account (HSA). It is for informational purposes and is not required to file a tax return. it shows the fair market value of your HSA account. Box 6 shows the type of account that is reported.
Advanced Scenario 4: Test Questions Barbara Jacobs
9. For the purpose of determining dependency, Marie meets the conditions to be the qualifying child of _______________.
a. Barbara b. Jenny
c. Both Barbara and Jenny
d. Neither Barbara nor Jenny

Qualifying child to meet dependency condition:
To claim your child as your dependent, your child must meet either the qualifying child test or the qualifying relative test: To meet the qualifying child test, your child must be younger than you and either younger than 19 years old or be a "student" younger than 24 years old as of the end of the calendar year. There's no age limit if your child is "permanently and totally disabled" or meets the qualifying relative test.

10. Jenny is not eligible to claim Marie for the earned income credit because her filing status is Married Filing Separate.
a. True b. False

You can claim the EITC if your filing status is married filing separately. To figure the credit, see Publication 596, Earned Income Credit 2021. When you file Form 1040 or 1040-SR, you must attach Schedule EIC to your return to claim the EIC with a qualifying child.
What is earned income credit?
2021 — The Earned Income Tax Credit (EITC) helps low-to-moderate-income workers and families get a tax break.
Advanced Scenario 5: Test Questions Michael Block
11. Michael’s mortgage insurance premium of $230 can be claimed as an itemized deduction on his Schedule A.
a. True b. False

Question 17 — Explanation: Taxpayers can deduct private mortgage insurance premiums paid during the current tax year on Schedule A in the Interest You Paid section.

12. What amount of gambling losses is Michael eligible to claim as a deduction on his Schedule A?
a. $0 b. $500 c. $1,000 d. $2,000

Gambling Winnings and Losses:
The taxpayer may receive one or more Forms W-2G reporting gambling winnings. Total gambling winnings must be reported as other income. If the taxpayer also had gambling losses, the losses can only be deducted on Schedule A. Gambling losses in excess of winnings are not deductible. And therefore the correct answer is $1,000, because the $1,000 was the amount of winning.
Advanced Scenario 6: Test Questions Sean Dennison
13. Sean is not required to file a tax return because he has enough tax withholding to cover his tax liability.
a. True b. False

Who is legally required to file a federal tax return?

If your filing status is single.

AND at the end of 2021 you were under 65.

THEN you must file a return if your gross income was at least $12,550.

14. Which of the following is not a requirement for Sean to claim the earned income credit as a single person with no qualifying children in 2021?

a. Sean must have a Social Security number valid for employment.
b. Sean must be at least age 25 but under age 65 on December 31.
c. Sean’s adjusted gross income must be below $21,430.
d. Sean cannot be the qualifying child of another taxpayer.
To qualify for the EITC, you must:
1. Must have a Social Security number valid for employment;
2. Adjusted gross income must be below $21,430.
3. Cannot be the qualifying child of another taxpayer;

What are the changes to EITC for 2021?
In the past, the EITC for those with no qualifying children was only available to people ages 25 to 64. In 2021 if you're not claiming a qualifying child, you must be at least 19 years old to qualify for Earned Income Credit (EIC).in 2021. The upper age limit is eliminated for 2021.

Earned Income Tax Credit (EITC) Relief for 2021.
If your earned income was higher in 2019 than in 2021, you can use the 2019 amount to figure your EITC for 2021.

Advanced Scenario 7: Gilbert and Tara Washington Interview Notes.
• Gilbert is an elementary school teacher at a public school. Gilbert and Tara are married and choose to file Married Filing Jointly on their 2021 tax return.
• Gilbert worked a total of 1,280 hours in 2021. During the school year, he spent $500 on unreimbursed classroom expenses.
• Tara retired in 2018 and began receiving her pension on October 1st of that year. She explains that this is a joint and survivor annuity. She has already recovered $1,013 of the cost of the plan.
• Gilbert settled with his credit card company on an outstanding bill and brought the Form 1099-C to the site. They aren’t sure how it will impact their tax return for tax year 2021.The Washingtons determined that they were solvent as of the date of the canceled debt.
• Tara won $3,000 gambling at a casino and had additional lottery winnings of $150. Tara has documented casino losses of $1,500.
• Their son, Chandler, is in his second year of college pursuing a bachelor’s degree in Logistics at a qualified educational institution. He received a scholarship and the terms require that it be used to pay tuition. Box 2 was not filled in and Box 7 was not checked on his Form 1098-T for the previous tax year. The Washingtons provided Form 1098-T and an account statement from the college that included additional expenses. The Washingtons paid $450 for books required for Chandler’s courses. This information is also included on the College statement of account.
• Chandler does not have a felony drug conviction.
• The Washington’s did not receive the third Economic Impact Payment (EIP 3) in the amount of $4,200. The Washington’s want to claim the third Economic Impact Payment (EIP 3) in the amount of $4,200 on their 2021 tax return.
• They are all U.S. citizens with valid Social Security numbers.

Income and documents – Year 2021:
1. Gilbert Washington Wages (Form W-2) how many jobs did you have last year? 1
2. Tuition Statement Scholarship (Form 1098-T) and Gordon College Account Statement.
3. Tara Washington Retirement Income Annuities (Form 1099-R).
4. Tara Washington Social Security Retirement Benefits (Form SSA-1099).
5. Tara Washington Other income Gambling (Form W-2G) $3,000 Lottery $150.
6. Gilbert Washington Credit Card Debt Cancelled (Form 1099-C).
7. Gilbert and Tara Washington Canceled Check for refund direct deposit with Account Number and Routing Number.

Expenses and Documents – Year 2021:
1. College Tuition for a dependent (Form 1098-T) $5,218.
2. Gordon College Account Statement for Course – Related Books $450.
3. Supplies used as an educator, 1,280 hours in 2021 and $500 on unreimbursed classroom expenses.
4. Recovery rebate credit, claim Economic Impact Payment (EIP 3) $4,200 Line 30 Form 1040.

Advanced Scenario 7: Gilbert and Tara Washington Tax Return Preparation Step-by-Step (TaxSlayer VITA Training Software).
2021 1040 Personal Information:
1. Filling Status: Married filing jointly
2. First Name Last Name Social Security Number (SSN)
3. Address
4. Dependents, Qualifying Child for Child Tax Credit, and Credit for Other Dependents
2021 1040 Income and Adjustments:
Line 1 (1040) Wages, salaries, tips. Attach Form W-2:
$35,502
Reference: 2021 IRS Publication 525 Taxable and Nontaxable Income For use in preparing 2021 Returns.
2021 What's New: Temporary Allowance of 100% Business Meal Deduction.
Line 5b (1040) Pensions and annuities Taxable amount:
18,035 Simplified Method Worksheet
Line 6b (1040) Social security benefits Taxable amount:
17,937 Social Security Benefits Worksheet
Line 8 (1040) Other income from Schedule 1, line 10:
$3,900
Line 9 (1040) Add lines 1 thru 8. This is your total income:
$75,37
Line 10 (1040) Adjustments to income from Sch1, line 26:
$250
Line 11 (1040) Your adjusted gross income (Line 10 minus Line 9):
$75,124
Line 12a (1040) Standard deduction:
$26,450
Line 15 (1040) Taxable income (Line 11 minus Line 12a):
$48,674
Line 16 (1040) Tax:
$5,443

Advanced Scenario 7: Test Questions Gilbert and Tara Washington (TaxSlayer VITA Training Software)
15. What is the taxable portion of Tara’s pension from Oak Enterprises using the simplified method?
a. $0 b. $17,862 c. $18,035 d. $18,485

The first step in figuring how much of a distribution is taxable is to determine the cost of your pension or annuity, Publication 575 Pension and Annuity Income – IRS, Cost (Investment in the Contract).

Using Worksheet A. Simplified Method Worksheet for Tara Washington.

16. None of Tara’s social security income is taxable.
a. True b. False
6a Social security benefits 21102 and 6b Taxable amount 17937

17. What is the total amount of other income reported on the Washington’s Form 1040, Schedule 1?
a. $3,900 b. $3,150 c. $2,400 d. $750 Cancellation of Credit Card Debt
Tara won $3,000 gambling at a casino and had additional lottery winnings of $150. And plus $750 Cancellation of Credit Card Debt equals to $3,900.

Gambling Winnings and Losses:
The taxpayer may receive one or more Forms W-2G reporting gambling winnings. Total gambling winnings must be reported as Other income. If the taxpayer also had gambling losses, the losses can only be deducted on Schedule A.

Cancellation of Credit Card Debt, Form 1099-C:
Lenders or creditors are required to issue Form 1099-C if they cancel a debt owed to them of $600 or more. Generally, an individual taxpayer must include all canceled amounts (even if less than $600) on the Other income line of Form 1040, Schedule 1.

18. Gilbert is eligible to deduct $500 as an adjustment to income on Form 1040, Schedule 1 for qualified educator expenses.
a. True b. False

Deducting Teachers' Educational Expenses – IRS:
Eligible educators can deduct up to $250 of qualified expenses paid during the tax year. If the taxpayer and spouse are both eligible educators, they can deduct up to $500, but neither can deduct more than their own expenses up to $250.

19. The Washington’s standard deduction on their 2021 tax return is $________. 26450
The standard deduction for married filing jointly for tax year 2021 rises to $25,100. IF your filing status is Married filing jointly, AND the number of boxes checked is 1 for Was born before January 2, 1957, THEN your standard deduction is $26,450 per Form 1040 2021 Standard Deduction Chart.

20. The total qualified expenses for the American Opportunity Credit are $ _________. 3655
+$5,218 Tuition – Fall Semester 2021 +$450 Course Related Books -$2,013 Scholarship = $3655

21. Which of the following credits are the Washingtons’ eligible to claim on their tax return?
a. Child tax credit b. Credit for other dependents c. Child and dependent care credit d. None of the above

Child Tax Credit and Credit for Other Dependents:
The child tax credit is unique because if a taxpayer cannot benefit from the nonrefundable credit, the taxpayer may be able to qualify for the refundable additional child tax credit on Schedule 8812, Credits for Qualifying Children and Other Dependents. Understanding of this credit may result in lower tax for you.

What is credit for other dependents?
There is a $500 credit for other dependents who do not qualify for the $2,000 child tax credit. The dependent must be a U.S citizen, U.S. national, or resident of the U.S. The dependent must have a valid identification number (ATIN, ITIN, or SSN).

22. What is the Washington’s total federal income tax withholding? $________. 6669

Advanced Scenario 8: Test Questions Cynthia Simon (Tax return using TaxSlayer Training Software)
23. What is the net short term capital gain reported on Cynthia’s Schedule D?
a. $2,350 b. $1,400 c. $650 d. $300

24. Which of the following cannot be claimed as a business expense on Cynthia’s Schedule C?
a. Cleaning supplies b. Business cards
c. Lunches d. Work gloves

Schedule C Part II: Expenses:
On Schedule C there are separate lines for the most common expenses that are incurred in a business. Lunches are not ordinary and necessary expense for that business.

25. What is the amount Cynthia can take as a student loan interest deduction on her Form 1040, Schedule 1? $__________________. 2500

26. What is the total amount of advanced premium tax credit that Cynthia received in 2021?
a. $3,960 b. $2,400 c. $1,800 d. $150

27. What is the amount of Cynthia’s lifetime learning credit? $_______________. 400
Qualifications to claim the Lifetime Learning Credit:
• Lifetime learning credit can be claimed for an unlimited number of years.
• Lifetime learning credit is a non-refundable credit of up to $2,000.
• The law requires that the student must generally receive a Form 1098-T, Tuition Statement, in order for the taxpayers to claim the education credit. Amounts paid must be paid to the educational institution.

28. Cynthia will have to pay $200 additional tax because she received the early distribution from her IRA.
a. True b. False
Exceptions to Tax on Early Distributions:
A taxpayer who has taken an early distribution from an IRA may take an exception to the 10% additional tax if the taxable part of the distribution is less than or equal to the adjusted qualified education expenses. Attach Form 5329 TAX ON EARLY RETIREMENT DISTRIBUTION.

29. How can Cynthia prevent having a balance due next year?
a. She can increase the withholding on her Form W-4
b. She can make estimated tax payments
c. She can use the IRS withholding calculator to estimate her withholding for next year.
d. All of the above
How can a taxpayer avoid a balance due next year?
1. If taxpayer needs to adjust the amount withheld, taxpayer may submit a revised Form W-4.
2. Taxpayer can make estimated tax payments.
3. Taxpayer to use the Tax Withholding Estimator to check withholding for next year.

Advanced Scenario 9: Richard Cook Interview Notes (Tax return using TaxSlayer Training Software).
• Richard is age 39 and was widowed in 2017.He has a daughter, Isabella, age 5.
• Richard provided the entire cost of maintaining the household and over half of the support for Isabella. In order to work, he pays childcare expenses to Busy Bee Daycare.
• Richard declined to receive advance child tax credit payments in 2021.
• Richard’s earned income in 2019 was $19,000.
• Richard and Isabella are U.S. citizens and lived in the United States all year in 2021.
• Richard received the third Economic Impact Payment (EIP3) in the amount of $2,800 in 2021.

Advanced Scenario 9: Richard Cook Test Questions.
30. What is Richard’s most advantageous filing status?
a. Single b. Married Filing Separately
c. Head of Household d. Qualifying Widower
A widow or widower with one or more qualifying children may be able to use the Qualifying Widow(er) filing status, which is available for two years following the year of the spouse’s death. Richard’s most advantage filing status is Qualifying Widower but he was widowed in 2017 and this is more than 2 years. Therefore he must use Head of Household filing status.

31. Richard’s adjusted gross income on his Form 1040 is $__________? 41580
How is taxpayer’s Adjusted Gross Income (AGI) used?
The taxpayer’s total Adjusted Gross Income (AGI) is the amount that is used to compute some limitations, such as the medical and dental deduction on Schedule A and the credit for child and dependent care expenses.

How is taxpayer’s Adjusted Gross Income (AGI) calculated:
1. Add the Income section. This is the taxpayer’s total income.
2. Add the Adjustments to Income section. These are the total Adjustments.
3. Subtract the Schedule 1 adjustments from the total income. This is the AGI.

32. Richard can claim the following credits on his tax return.
a. Child Tax Credit b. Child and Dependent Care Credit
c. Both a and b d. Neither a nor b

33. Richard’s Retirement Savings Contributions Credit on Form 8880 is $_______. 100

How you handle IRA contributions?
1. Taxpayers may be able to deduct some or all of their contributions to the IRA.
2. Amounts in an IRA, including earnings, are not taxed until distributed.
3. Contributions may be eligible for the retirement savings contributions credit.

34. Richard will use his 2019 earned income rather than his 2021 earned income to calculate the earned income tax credit on his 2021 tax return because his 2019 earned income is higher than his 2021 earned income.
a. True b. False
Richard’s 2019 earned income is $19,000, and Richard’s 2021 earned income is $41,500.

1040 Tax Form Changes for 2021:
Line 27c is added for taxpayers to include their 2019 earned income if they elect to use that amount when figuring their earned income credit.

35. Richard’s child and dependent care credit from Form 2441 is reported as a nonrefundable credit on Form 1040, Schedule 3.
a. True b. False

Credit for child and dependent care expenses from Form 2441, line 11 is reported on Form 1040, Schedule 3, Line 2, Attach Form 2441.

Where can you find answers to additional questions about the CTC? For up to date information about the CTC and reconciling advance payments, go to https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021.
2021 International Course Scenarios and Test Questions:
2021 International Exam Certification 93% Pass Proof.

Directions:

The first two scenarios do not require you to prepare a tax return. Read the interview notes for each scenario carefully and use your training and resource materials to answer the questions after the scenarios. The answers are in bold.

International Scenario 1: Andy and June Hillsdale — Interview Notes;
• Andy and June currently live in Hong Kong.
• They moved there on February 15, 2020 and rent a 2-bedroom apartment. Andy was transferred there for an indefinite period of time. Andy and June intend to eventually return to the United States.
• Andy is employed by a U.S.-based Fortune 500 company and June teaches English as a second language.
• Andy and June returned to the U.S. for 7 days for a family funeral in August of 2021.They also took a 13 day vacation to Macao, China to gamble and relax.
• Neither Andy nor June work for the U.S. government.
• Andy and June have a house in the U.S. It is vacant while they are overseas. Their brother and sister-in-law house sit while they are living abroad.
• Andy and June are U.S. citizens and have valid Social Security numbers.

International Scenario 1: Andy and June Hillsdale — Test Questions and Answers;
1. When calculating the 330 full days in a foreign country for the physical presence test, how is the 13-day vacation treated?
a. None of days are counted as days spent in a foreign country
b. Only the first and last days of the trip do not count as days spent in the foreign country
c. All of the days are counted as days spent in the foreign country
d. Only 5 of the 13 days count as spent in the foreign country

2. In order for Andy and June to exclude their foreign earned income, they must ________.
a. Have income that qualifies as foreign earned income
b. Demonstrate that their tax home is in a foreign country
c. Meet the physical presence test
d. All of the above

Question 1 — Explanation:
What is the difference between physical presence test and bona fide residence test?

IRS physical presence test definition:
You meet the physical presence test if you are physically present in a foreign country or countries 330 full days during any period of 12 consecutive months.

Determination that you meat tax home test in a foreign country is explained under Chapter 4 of Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.

IRS Bona fide residence test definition:
To qualify for bona fide residence, you must reside in a foreign country for an uninterrupted period that includes an entire tax year.

During the period of bona fide residence in a foreign country, you can leave the country for brief or temporary trips back to the United States or elsewhere for vacation or business.

The bona fide residence test applies to U.S. citizens and to any U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect.

If you go there to work for an indefinite or extended period and you set up permanent quarters there for yourself and your family, you probably have established a bona fide residence in a foreign country, even though you intend to return eventually to the United States.

Question 2 — Explanation:
What are the eligibility requirements to exclude foreign earned income?
To claim the foreign earned income exclusion, taxpayers must:

Demonstrate that their tax home is in a foreign country.

Meet either the bona fide residence test or the physical presence test.

Have income that qualifies as foreign earned income.

International Scenario 2: Wilhelm and Mary Schmidt — Interview Notes;
• Wilhelm and Mary are married and live in Stuttgart, Germany.
• Mary is a U.S. citizen and has a valid Social Security number. Wilhelm is a citizen of Germany and has an ITIN for U.S. tax filing purposes.
• In 2017, Wilhelm and Mary chose to treat Wilhelm as a resident alien for tax purposes. This choice has never been suspended or revoked.
• Wilhelm and Mary have a daughter, Helga, who was born on July 23, 2020.Helga is a U.S. citizen and has a valid Social Security number issued by the due date of the return, including extensions.
• When both of Wilhelm’s parents died last year, his uncle Hans moved in with them. Hans is a citizen of Germany and has no income.
• Mary is employed by a Fortune 500 company and earned $27,500.
• Wilhelm works as a part-time brewer and earned the equivalent of $18,000 in U.S. dollars.
• Wilhelm and Mary provide all the financial support for Helga and Hans.

International Scenario 2: Wilhelm and Mary Schmidt — Test Questions with Answers;
3. Neither spouse wishes to revoke their election to treat Wilhelm as a resident alien. What are Wilhelm and Mary’s filing status options this year?
a. They must file Married Filing Separately
b. They must file Married Filing Jointly
c. Mary can chose to file Single and Wilhelm does not have to file at all
d. They can chose Married Filing Jointly or Married Filing Separately

4. How can the Schmidts decide to end their election to treat Wilhelm as a resident alien?
a. Divorce or Legal Separation
b. Revocation in writing
c. Death of either spouse
d. All of the above

5. On a Married Filing Jointly return, can Wilhelm and Mary claim the Credit for Other Dependents for Uncle Hans?
a. No, because Hans is not a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico
b. Yes, because Hans is a qualifying relative with no income
c. Yes, because Hans meets the relationship test d. None of the above

6. On a Married Filing Jointly return, Wilhelm and Mary are able to claim which of the following credits for Helga?
a. Child tax credit
b. Earned income credit
c. Other Dependents Credit
d. None of the above

Question 6 — Explanation: What is the amount of the Child Tax Credit for 2021? (Updated January 11, 2022)
For tax year 2021, the Child Tax Credit increased from $2,000 per qualifying child to:
• $3,600 for children ages 5 and under at the end of 2021 and
• $3,000 for children ages 6 through 17 at the end of 2021.

References:
1. 2021 IRS Fact Sheet updates the 2021 Child Tax Credit and Advance Child Tax Credit frequently asked questions (FAQs).
2. IRS 2021 Publication IRS User Guide: 5549, Child Tax Credit Update.
3. IRS 2021 Publication 5534-E, Advance Payments of the Child Tax Credit Which Online Tool Should I Use?.
If your situation has changed in 2021, updating this information, using Publication 5534-E, will help you get the most accurate amount of advance payments.
2021 IRS Publication 5549, user guide includes information to help you how to use the IRS’s Child Tax Credit Update Portal to:

• Check if you’re enrolled to receive advance payments.
• Un-enroll from advance payments of the Child Tax Credit.
• Update or provide bank account information for direct deposit.
• View the status of your payments.
• Update or provide a mailing address.

Additional Information:
1. 2021 Publ. 501 Dependents, Standard Deduction, and Filing Information, for use in preparing 2021 RETURNS.
2. 2021 Publ. 596 Earned Income Credit (EIC), for use in preparing 2021 RETURNS.

International Scenario 3: Justin Herzing — Interview Notes;
• Justin Herzing is a U.S. citizen, single, and has no children. He has lived and worked in England since March 20, 2013.He does not maintain an address in the U.S. and has no intentions of returning.
• He considers himself a resident of England. He rents an apartment at 700 Bond Street, London, UK W2SC5.
• Income:

— Justin’s visa type: Unlimited.
— Justin works at the U.S. Embassy and has a Form W-2 for his salary.
— In 2021, Justin got a job working part time in a pub as a waiter. The pub is called the Tilted Crown and located at 256 Oxford Street, London, UK, 2WSC4.Justin earned an equivalent of $4,790 in wages and paid taxes totaling $295. His taxes were paid to England as he earned his wages.
— Justin earned $215 (converted to U.S. dollars) of dividends from Rothchilds Corp. He paid foreign tax to England on these dividends in the amount of 33.0 Pounds. The exchange rate on the date he paid the tax was 1 U.S. Dollar (USD) = 0.746 Pounds. Justin’s dividends are not qualified dividends for U.S. tax purposes.

• Justin was not required to file FinCen Form 114 and he did not receive a distribution, was not a grantor of, nor was he a transferor to a foreign trust.
• Justin did not itemize in 2020 and does not have enough deductions to itemize in 2021.
• Justin received a $1,400 Economic Impact Payment (EIP 3) in March 2021.

International Scenario 3: Justin Herzing — Test Questions with Answers;
7. What is the maximum amount of foreign earned income excluded from Justin’s tax return?
a. $0 b. $4,790 c. $46,530 d. $51,320

Question 7 — Explanation: Justin earned an equivalent of $4,790 in wages and paid taxes totaling $295. His taxes were paid to England as he earned his wages.

The foreign tax credit is different from the foreign earned income exclusion. If the taxpayer uses the foreign earned income exclusion, foreign tax paid on the excluded income cannot be used to claim the foreign tax credit.

8. Justin does not have to report his dividend income from Rothchilds Corp. because:
a. Form 1099-DIV was not issued to him
b. He already paid foreign taxes to England on his dividends
c. Foreign passive income is not taxable
d. None of the above. He must report his worldwide income, which includes his dividend income.

Question 8 — Explanation: Justin’s dividends are not qualified dividends for U.S. tax purposes. There are two types of ordinary dividends: qualified and nonqualified. The difference between the two is that nonqualified dividends are taxed at ordinary income tax rates. For a definition of qualified dividends, refer to Publication 550, Investment Income and Expenses.

9. General category income consists of income earned in a foreign country that an individual does not exclude, or excludes only part of, under the foreign earned income exclusion.
a. True b. False

Question 9 — Explanation:
• Justin is a U.S. citizen who lives and works in England. Justin earned $215 (converted to U.S. dollars) of dividends from Rothchilds Corporation.

• Justin paid foreign tax to England on $215 dividends in the amount of 33.0 Pounds. The exchange rate on the date he paid the tax was 1 U.S. Dollar (USD) = 0.746 Pounds. Therefore 33 Pounds divided by 0.746 Dollar = 44 U.S. Dollars.

• Justin paid foreign tax in the amount of $44 to England on his $215 dividends income. and $44 divided by $215 = 20% income tax rate.

• Justin Herzing is a U.S. citizen who lives in England and in 2021 he paid 20% income tax rate on $215 dividends income from Rothchilds Corporation.

• For the tax purpose of Form 1116, Justin’s foreign dividend income should be classified as Passive Category Income or General Category Income. Dividends Income Tax qualifies for the foreign tax credit and qualifies as a Passive Category Income, because it is less than 37% of the highest U.S. income tax rate. Reference: IRS Publication 514, Foreign Tax Credit for Individuals for preparing 2021 RETURNS.

• Since 20% tax rate, Justin paid on dividend income is no more than the highest 37% U.S. income tax rate, Justin’s income falls under the “Passive Category Income”.

IRS, what is the highest U.S. income tax rate 2021:
For tax year 2021, the top tax rate remains 37% for individual single taxpayers with incomes greater than $523,600.

10. Which source of Justin’s income qualifies for the foreign earned income exclusion?
a. Wages from the pub
b. Dividends from Rothchilds Corp
c. Wages from U.S. Embassy
d. None of the above

Question 10 — Explanation:
• General category income consists of income earned in a foreign country that an individual does not exclude, or excludes only part of, under the foreign earned income exclusion.

• What type of income qualifies for foreign earned income exclusion? You may qualify to exclude your foreign earnings from income up to an amount that is adjusted annually for inflation $108,700 for 2021, and $112,000 for 2022. In addition, you can exclude or deduct certain foreign housing amounts.

• Foreign Earned Income Exclusion; If you meet certain requirements, you may qualify for the foreign earned income exclusion. To claim the foreign earned income exclusion, you must have foreign earned income, your tax home must be in a foreign country and you must be a U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

11. Justin does meet the requirements of the bona fide residence test and can exclude his foreign earned income.
a. True b. False

Question 11 — Explanation: To claim the foreign earned income exclusion, taxpayer must;
• Demonstrate that their tax home is in a foreign country.
• Meet either the bona fide residence test or the physical presence test.
• Have income that qualifies as foreign earned income.

12. Which of the following statements is false?
a. Justin has both passive and general categories of foreign income
b. Justin can take the foreign tax credit for the income taxes paid on his dividend income from Rothchilds Corp and has to file the Form 1116, Foreign Tax Credit
c. Justin can claim both the foreign tax credit for the $295 income taxes paid to England and exclude the $4,790 foreign earned income from his part time job at the pub
d. Justin can claim the foreign earned income exclusion of $4,790 from his part time job at the pub. Therefore, he cannot take the foreign tax credit for the $295 income taxes paid to England

Question 12 — Explanation: Can you take a foreign tax credit for taxes on income you excluded or could have excluded? Once you choose to exclude foreign earned income and/or foreign housing costs, you cannot take a foreign tax credit for taxes on income you excluded or could have excluded.

13. Justin must include the amount of foreign tax paid to England as withheld Federal income taxes. a. True (b. False)

Question 13 — Explanation: How do I claim foreign tax withheld?
File Form 1116, Foreign Tax Credit, to claim the Foreign Tax Credit (FTC) and File Form 2555, Foreign Earned Income to claim the Foreign Earned Income Exclusion (FEIE), which allows those who qualify to exclude some or all of their foreign-earned income from their U.S. taxes. Corporations file Form 1118, Foreign Tax Credit—Corporations, to claim a foreign tax credit.

14. Which of the following statements is true?
a. Once the election is made to exclude foreign earned income, that choice remains in effect for that year and all later years until revoked
b. The foreign earned income exclusion is voluntary
c. The election for the foreign earned income exclusion is made by completing the Form 2555, Foreign Earned Income
(d. All of the above.)

Question 14 — Explanation: Once you choose to exclude your foreign earned income, filing Form 2555, that choice remains in effect for that year and all later years unless you revoke it. 15. What is the amount of foreign taxes paid on the dividend income, converted to U.S. dollars? (Round to the nearest dollar).
a. $25 b. $44 c. $187 d. $335

Question 15 — Explanation:
1 U.S, Dollar = 0.746 Pounds and therefore 33 Pounds Divided by 0.746 = $44 U.S. Dollars and the correct answer.

2021 Military Course Scenarios and Test Questions with Answers and Explanations:

2021 Military Exam Certification 93% Pass Proof.

Directions:
For Interview Notes refer to 2021 Publication 6744 VITA/TCE Volunteer Assistor’s Test/Retest. The first four scenarios do not require you to prepare a tax return.
Military Scenario 1: Todd Long — Test Questions.
1. Todd is not able to take an adjustment to income for:
a. Travel to and from duty station
b. Meals
c. Both a and b
d. Uniforms

2. What is the amount of the deductible mileage expense? $______________. 2016 = 3,600 miles X $0.56

Question 1 — Explanation: The cost and upkeep of reservist’s uniforms, suitable to wear off duty, is not allowable as an adjustment to income.

Question 2 — Explanation:
What is the IRS issued Standard Military Mileage Rate for 2021?
Military Privately Owned Vehicle (POV) Mileage Reimbursement Rates for Year 2021 is 56 cents per mile driven for business use, 16 cents per mile driven for medical or moving purposes for qualified active duty members of the Armed Forces.

Todd’s duty station is 150 miles away from his residence. He drove 3,600 miles to and from his duty station based on his travel log.

What is the 100-mile rule for reservists?
Military reservists who must travel more than 100 miles away from home to attend a drill are able to deduct their travel expenses as an adjustment to income.

Military Scenario 2: Dave and Sandra Blackburn — Test Questions.
3. Their net financial profit from the move will be reported on:
a. Form 1099-INT, Interest Income
b. Form W-2, Wage and Tax Statement
c. Form 1040 Schedule A, Itemized Deductions
d. None of the above. It doesn’t need to be reported.

Question 3 — Explanation:
When the move is completed, the Armed Forces member provides receipts and paperwork to substantiate authorized expenses. The net financial profit is taxable and is reported on a separate Form W-2.

4. The Blackburns can deduct the cost of their side trip and house hunting trip as qualified moving expenses.
a. True (b. False)

5. How much can Dave and Sandra claim for the mileage $ _______. (Round to near¬est dollar).
a. $346 2,163 milesX$0.16 per mile for moving=$346
b. $380
c. $1,211
d. $1,332

Question 5 — Explanation:
In 2021, the standard IRS mileage rate is 56 cents per mile for business miles driven, 16 cents per mile for moving or medical purposes and 14 cents per mile for charity miles driven.

The Blackburns drove their rental truck a total of 2,378 miles. The shortest, most direct route calculated by the Navy was 2,163 miles.

6. How much can Dave and Sandra claim as their total qualified lodging expenses?
a. $0
b. $79
c. $316 $79 X 4 nights = $316
d. $362

Question 6 — Explanation:
The allow¬able lodging per diem was $79 per night. Dave and Sandra Blackburn’s trip took a total of nine days and eight nights instead of the authorized 4 nights for travel.

Military Scenario 3: Lisa Wagner — Test Questions.
7. Which of the following documents are issued by the VA for disability payments?
a. Form W-2, Wage and Tax Statement
b. Forms W-2 or 1099-R, depending on type of disability.
c. No tax form is required to be issued; however, Lisa may receive a statement.
d. Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit Sharing Plans, Insurance Contracts, etc.

8. The disability payment of $2,950 that Lisa received from the VA is non-taxable.
a. True b. False

Question 8 — Explanation: Disability benefits received from the VA should not be included in your gross income.
Military Scenario 4: Robert and Shirley Myers — Interview Notes.
• Robert and Shirley Myers are married and have a 13 year old daughter who lived with Shirley all year.
• Robert was deployed to Afghanistan on June 1, 2021.His last day in the combat zone is scheduled for May 3, 2022.
• Robert’s Form W-2 shows:
Box 1 = $15,000
Box 12a = $20,000, Code Q
• Shirley’s Form W-2 shows $34,000 in Box 1. This is her only income.
• Robert, Shirley, and their daughter are all U.S. citizens and have valid Social Security numbers. The entire family lives in the U.S.
Military Scenario 4: Robert and Shirley Myers — Test Questions.
9. Robert and Shirley cannot choose to exclude their combat pay for the purposes of calculating the earned income credit. a. True b. False

Question 9 — Explanation:
Nontaxable Combat Pay Election and the Earned Income Tax Credit;
If the family does not use the NCPE, then they would claim an EITC of $4,000. However, if the family were to include their nontaxable combat pay, then their EITC earned income increases to $20,000 and their EITC would increase by over $1,000 from $4,000 to $5,028.

By default, nontaxable combat pay is excluded from earned income. Nontaxable combat pay is listed on Form W-2, box 12, with Code Q.

Even though your nontaxable combat zone pay is excluded from income, you can elect to include your nontaxable combat zone pay in earned income for the purpose of calculating your Earn Income Credit (EIC). If you make that election, you must include in earned income all nontaxable combat zone pay you received.

10. Robert and Shirley have ______ days to file their 2021 tax return after he returns from the combat zone.
a. 105 b. 180 c. 288 d. 365

Question 10 — Explanation:
How long Robert has to file his tax return after he returns from the combat zone deployment?:
180 days.
Robert was deployed in the combat zone from June 1, 2021 through May 3, 2022. The deadline for filing Robert’s 2021 return is figured as follows:

The deadline for filing Robert’s income tax return is 180 days after his last day in the combat zone.
In addition to the 180 days extension, the extension includes the 108 additional days left in the filing period when Robert entered the combat zone.

The official deadline for filing 2021 federal income tax returns is April 18, 2022.

The 108 additional days are the number of days in the 3-1/2 month filing period that were left when Robert entered the combat zone (January 1 – April 18, 2021). Therefore the correct answer is 180 + 108 = 288 days.

May 3, 2022 is Robert’s last day of deployment in the combat zone. And therefore when adding 288 days to Robert’s last day of deployment, the deadline for filing Robert’s 2021 tax return is February 9, 2023.

How should the IRS be notified about combat zone service?
The IRS works with the Department of Defense to identify taxpayers who are serving in a combat zone. This may allow the IRS to suspend compliance actions, such as audits or enforced collections, until 180 days after the taxpayer has left the zone.

Military Scenario 5: Daniel and Betty Simmons — Test Questions
11. Daniel and Betty can claim $14,482 as their total rental expenses on their joint return?
a. True b. False

Question 11 — Explanation: If you receive rental income from the rental of a dwelling unit, there are certain rental expenses you may deduct on your tax return. These expenses may include mortgage interest, property tax, operating expenses, depreciation, and repairs.
— Insurance: $1,900
— Management fees: $1,045
— Betty paid $1,373 to fix a broken window. Betty filled a pothole in the driveway, and repaired a broken pipe. The repair was worth $675 compared to the estimate from the asphalt contractor. The $675 Betty’s labor is not an eligible rental expense deduction but cost for imporvement. Betty may not deduct the cost of improvements. The cost of improvements is recovered through depreciation.
— Real estate property tax: $2,114.
— Mortgage Interest: $4,750.
— Depreciation: $3,300 (annual amount previously calculated by Betty’s accountant).

12. Code “Q” in box 12a of Daniel’s W-2 represents combat pay. a. True b. False

13. Which schedule is used to report rental income and expenses? a. Schedule F, Profit or Loss From Farming b. Schedule E, Supplemental Income and Loss c. Schedule D, Capital Gains and Losses d. Schedule C, Profit or Loss From Business
14. Combat pay ______________________
a. May increase the Earned Income Credit
b. May increase the Child Tax Credit
c. Is reported on Form W-2 in Box 12 with Code Q
d. All of the above

Question 14 — Explanation:
Though your combat zone pay is excluded from income, you can elect to include it in income in figuring your EIC.

15. Which of the following credits can be claimed for their son, Brian?
a. Credit for Other Dependents
b. Earned Income Credit
c. Child Tax Credit
d. Both a and b

Question 15 — Explanation:
IRS 18 year old child qualifies for Earned Income Credit and Credit for Other Dependents if under age 19 at the end of the year and younger than you (or your spouse, if you file a joint return).

2021 Foreign Student Exam with Answers and Explanations:
2021 Foreign Student Exam Certification 82% Pass Proof.

Part 1 VITA/TCE Foreign Student Exam Certification Covers:

Residency status,

Use of Form 8843, and

Filing status.

Filing status: If both married taxpayers are nonresident aliens, they CANNOT file as Married Filing Jointly, they must file as Married Filing Separately. Nonresident aliens must use either the Single or the Married Filing Separately filing status.

Only residents of Canada, Mexico, S. Korea, and India may qualify for the Qualifying Widow(er) with Dependent Child(ren) status, if applicable.

As an exempt individual you must file Form 8843, Statement for Exempt Individuals with IRS to explain the basis of your claim that you can exclude days of presence in U.S. for purposes of the substantial presence test.

When and Where To File:
If you are filing a 2021 Form 1040-NR, attach Form 8843 to it. Mail your tax return by the due date (including extensions) to the address shown in your tax return instructions.

If you don’t have to file a 2021 tax return, mail Form 8843 to the Department of the Treasury, Internal Revenue Service Center, Austin, TX 73301-0215 by the due date.

If you had no US income and are only filing IRS Form 8843, the deadline is June 15, 2022.

2021 Part 1 Foreign Student Test – Residency Status, Form 8843, and Filing Status 1-17:
1.Ken entered the U.S.as a student on July 30, 2018 in F-1 immigration status. He had never been to the United States before and he did not change immigration status during 2021. For federal income tax purposes, Ken is a resident alien for 2021.
a. True
b. False Ken is a nonresident alien for 2021.

2. Helen is a visiting professor at the local university. Helen was a graduate student from June 2017 to May 2019 in F-1 immigration status. She re-entered the United States as a teacher on December 20, 2020 in J-1 immigration status. For federal income tax purposes, Helen is a nonresident alien for 2021.
a. True
b. False Helen is a resident alien for 2021.

3. Yusuf served as a visiting scholar in F-1 immigration status from March 2017 through June 2020.In August of 2021, Yusuf returned to the United States as a professor. For federal income tax purposes, Yusuf is a resident alien for 2021.
a. True Yusuf is a resident alien for 2021.
b. False

4. Juan came to the United States in F-2 immigration status with his wife on July 15, 2017. He has not changed his immigration status. For federal income tax purposes, Juan is a resident alien for 2021.
a. True Juan is a resident alien for 2021.
b. False

5.Emily lived with her parents in F-2 immigration status in the United States from August 2010 to June 2012. She returned to the U.S.to attend college in F-1 immigration status on December 5, 2019. Emily needs to file Form 8843 for 2021.
a. True
b. False Emily does not need to file Form 8843 for 2021.

Question 5: Explanation - Who Must File Form 8843: Emily lived in U.S. 2010 - 2012 and 2019 - 2020, 5 years and therefore she is a resident alien for tax purposes in 2021.
6. Polina entered the United States on July 30, 2016 in J-1 student immigration status. On January 10, 2020, her husband Dmitry joined her in J-2 immigration status. Because Polina is a resident alien this year, Dmitry does not need to file Form 8843 for 2021. He is electing to file married filing jointly with her.
a. True
b. False Dmitry need to file Form 8843 for 2021.

7. Polina and Dmitry from Question 6 had a son, Alexander, while here in the U.S. on December 5, 2020. A Form 8843 does not need to be filed for Alexander for 2021.
a. True F8843 does not need to be filed for Alexander for 2021.
b. False

8. Sophie and Yves have been in the U.S. as students in F-1 immigration status, since August 2018. Their 12-year-old son, Vincent, has been attending a boarding school in the U.S. since June 2015 in F-1 immigration status. Sophie, Yves, and Vincent all need to file Form 8843 for 2021.
a. True.
b. False Sophie, Yves, and Vincent don’t need to file F8843 2021.

9. Celeste is from Pakistan and is a Ph.D. student in communications engineering who is going to defend her dissertation in June. She arrived in the U.S. as a student on July 20, 2018. Celeste is a resident alien for tax purposes in 2021.
a. True
b. False Celeste is a nonresident alien for tax purposes in 2021.

10. Marcus is a junior majoring in biology. He is in the U.S.in F-1 immigration status from Germany. He transferred from a German university and arrived in the U.S. on December 30, 2018. Marcus worked in a lab on campus in an approved summer internship program for a company in New York. He will graduate in May, 2022. The company issued him a Form 1099-NEC. Marcus is considered a resident alien for tax purposes since the company issued him a Form 1099-NEC.
a. True
b. False Marcus is still considered a nonresident alien for tax purposes.

11. Nico is a nursing student from Greece who first arrived in F-1 immigration status on August 15, 2021. He does not have a tax identification number and he did not work or receive a scholarship in 2021, but had $75 interest income from his U.S. savings account his parents set up for him to pay for school and his living expenses. Nico must file Form 8843, and also Form 1040-NR to report his interest income for 2021.
a. True
b. False Nico must only file Form 8843.

12. Bo entered the U.S.in J-1 immigration status as a trainee in January 2019, and lives alone. His wife, Mei, could not accompany him because she had to care for her ailing parents. Bo can file as Single because he did not live with his spouse at all during 2021.
a. True
b. False Bo must file as Married Filing Separately.

13. Alex and Kim were married in March 2016, and the next year they both entered the U.S.in F-1 immigration status to complete their studies as Fulbright schol¬ars. Currently, Alex lives in San Diego, where he is completing his graduate work. However, Kim left him in March 2020 and has not been heard from since. Her parents will not tell him where she lives and he has not heard from her since. Since Alex does not know Kim’s whereabouts, he can file using the Single filing status.
a. True
b. False Alex must file using Married Filing Separately filing status.

2020 Scenario 1: Lee Satō: 14-17 (4)
Use the following information to prepare Form 8843. (The correct answers are in parentheses.)

• Lee Satō came to the U.S. to study on August 1, 2018, in F-1 immigration status. Her passport number is 4682936 and it was issued by her home country, Japan. Her home address is 5-3 Yaesu 1-Chome, Chuo-ku, Tokyo 100-8994, Japan. Her address at school is Firestone University, 222 Tread Blvd., Lauderdale, MN 55000. Her U.S. taxpayer identification number is XXX-XX-XXXX.

• Lee is attending Firestone University, 222 Tread Blvd., Lauderdale, MN 55000, tele¬phone 612-555-XXXX. Her specialized program is Alternative Fuel Systems and the director is Professor Marri M. Young, also at 222 Tread Blvd., Lauderdale, MN 55000, telephone 612-555-XXXX ext. 1267.

• Lee has not taken steps to apply for permanent residency. Lee had no income, so she is not required to file any other tax forms. Lee has not left the U.S. since arriv¬ing.

• After completing the required tax form, review the scenario and resource materials, and answer each of the test questions.

2021 Scenario 1: Enrique Satō Test Questions 14-17 (4).
Directions:
To answer the following multiple choice questions, refer to the Form 8843 you completed for Enrique Satō.

14. What should Enrique enter on Line 1b?
a. Leave blank
b. F1 January 1, 2020 H1b
c. F1

15. Enrique has to complete Lines 4a and 4b.
a. True
b. False

16. Enrique only has to complete Part 1 of Form 8843.
a. True
b. False)

17. What is the due date of Lee’s Form 8843 for tax year 2021?
a. April 18, 2022
b. June 15, 2022 Correct
c. October 15, 2022
d. December 31, 2022

Question 17 — Explanation: Deadline for submitting Form 8843 to IRS, even if you have had no income in 2021, you must file and submit the IRS Form 8843; the deadline to submit your Form 8843 is June 15, 2022. Dependents in F-2 and J-2 status must also file Form 8843.

2021 Form 8843 Statement for Exempt Individuals, Scenario 1, Enrique Satō, Peru, Sheet 1:

2021 Form 8843 Statement for Exempt Individuals, Scenario 1, Enrique Satō, Peru, Sheet 2:

Form 8843 can't be E-Filed. Mail Form 8843 by the due date June 15, 2022 to:
Department of the Treasury,
Internal Revenue Service,
Austin, TX 73301-0215

Exempt Individual - Who is a Student:
A student is any individual who is temporarily in U. S. on an "F, " "J, " "M, " or "Q " visa for the primary purpose of studying at an academic institution or vocational school, and who substantially complies with the requirements of that visa.

2021 Form 8843 Instructions:
Who must file:
You must file Form 8843 to claim days of presence in U. S. for purpose of the substantial presence test. To exclude days of presence as a student, complete Parts I and Part III of Form 8843. You must file even if you had no income in year 2021, by the deadline June 15, 2022.

Part I — General Information.
You are required to complete lines 1a through 4a and 4b of Form 8843 if you’re filing Form 8843 by itself and not filing Form 1040-NR.
Line 1a.
Type of U.S. visa (for example, F, J, M, Q, etc.) and date you entered the United States.
Line 2.
Of what country or countries were you a citizen during the tax year?
Line 3a.
What country or countries issued you a passport?
Line 3b.
Enter your passport number(s)
Line 4a.
Enter the actual number of days you were present in the United States during: 2020, 2019, 2018.
Line 4b.
Enter the number of days in 2020 you claim you can exclude for purposes of the substantial presence test.

Part III — Students:
If you qualify to exclude days of presence as a student, complete Part I and Part III of Form 8843 only.
Line 9. Enter the name, address, and telephone number of the academic institution you attended during 2020
Line 10.
Enter the name, address, and telephone number of the director of the academic or other specialized program you participated in during 2020.
Line 11.
Enter the type of U.S. visa (F, J, M, or Q) you held during: 2014, 2015, 2016, 2017, 2018, 2019. If the type of visa you held during any of these years changed, attach a statement showing the new visa type and the date it was acquired.
Line 12.
Were you present in the United States as a teacher, trainee, or student for any part of more than 5 calendar years? Yes or No.
If you checked the “Yes” box on line 12, you must provide sufficient facts on an attached statement to establish that you do not intend to reside permanently in the United States.
Line 13.
During 2020, did you apply for, or take other affirmative steps to apply for, lawful permanent resident status in U. S. or have an application pending to change your status to lawful permanent resident of U. S.? Yes or No.
Line 14.
If you checked the “Yes” box on line 13, explain.

2021 Part 2 Foreign Student Test – Taxability of Income, ITINs, and Credits 18-37:
Introduction: This segment of the VITA/TCE certification test includes 7 general and 12 scenario-based multiple choice questions on taxability of income, ITINs, and credits.

18. Margarita, who is a nonresident alien and is in the United States in J-1 immigration status, spent $4,400 on qualifying tuition and educational expenses. She is entitled to claim an education credit on her tax return.
a. True b. False

Question 18 — Explanation:
Education Credits — If the taxpayer is a nonresident alien for any part of the year, they generally can’t claim the educational credits, such as the American Opportunity Credit and Lifetime Learning Credit.

19. Ji-yoo received $73 of dividend income on U.S. stocks she purchased online. She is an international student from Canada in F-1 immigration status. She arrived in the United States in 2020. Ji-yoo’s dividend income will be taxed at 30% on Form 1040-NR, Schedule NEC.
a. True b. False

Question 19 — Explanation: Tax Treaties/ Taxation Rate - Dividends (paid by U.S. Corporations).

Dividend Income: Generally, dividend income from investments in U.S. corporate stock is income, NOT effectively connected to the taxpayer’s U.S. trade or business and is therefore taxable at a 30% rate on Form 1040-NR, Schedule NEC.

20. Marie and Nathan are a married nonresident alien couple from France. Both are in the U.S. in F-1 immigration statuses and arrived in 2021. They paid $3,700 in childcare expenses, while attending school, for their child who was born in the United States and is a U.S. citizen. They are eligible to claim the child and dependent care credit on their Form 1040-NR.
a. True b. False

Question 20 — Explanation: Marie and Nathan are not eligible to claim the child and dependent care credit they can only claim the credit if they file a joint return.

21. Antero is a student in J-1 immigration status from Latvia. He earned $2,300 in wages in 2021. His wages are reported to him on Form 1042-S (Box 1, Income Code 20). Antero should report these wages on Form 1040-NR, Schedule OI.
a. Yes b. No

Question 21 — Explanation: If the income is exempt from tax by treaty, complete item L of Schedule OI (Form 1040-NR) and line 1c on page 1 of Form 1040-NR.

Schedule OI (Form 1040-NR).
For item L, identify the country, tax treaty article(s) under which you are applying for a refund of tax, the number of months in prior years that you claimed the treaty benefit and the amount of exempt income in the current year. Also attach Form 8833 if required.

22. Gus is a student here in J-1 immigration status as of October 15, 2021. Under the terms of his visa, he is permitted to work in the U.S. Gus does not qualify for a Social Security number and should apply for an ITIN.
a. True b. False

Question 22 — Explanation: Generally, students who enter the United States in an immigration status which allows them to be employed in the United States are eligible to apply for a Social Security Number (SSN) from the Social Security Administration. If a student is granted permission to work, Social Security and Medicare taxes are not withheld from their pay.

23. Elena, in F-1 student immigration status from Romania, is on the basketball team. She arrived in the U.S. on June 18, 2021 on a full athletic scholarship that includes payments for her room and board. The amount of her scholarship for room and board is taxable.
a. True b. False

Question 23 — Explanation: Countries with Treaty Benefits for Scholarship Grants (Income Code 16). Full Athletic Scholarship grants that cover room, board and other personal expenses are subject to U.S. tax unless a treaty benefit (as summarized below) exists.

24. Gunther is a student in the U.S. in F-1 immigration status. He arrived from Germany on July 13, 2019. Gunther worked in the bookstore and earned $2,500 in wages and had federal income tax withholding of $215. Gunther needs to file Form 1040-NR and Form 8843 for 2021.
a. True b. False

Scenario 2: Kim Lee Test Questions 25-29 (5).
Directions: To answer the following multiple choice questions, refer to the Form 1040-NR you completed for Kim Lee. Attach any Form 1042-S you received for treaty-exempt income.

25. What amount is entered on the line for wages, salaries, tips, etc. on Form 1040-NR?
a. $2,000
b. $6,000
c. $8,500 from Form W-2 Box 1

26. What is on the line for Adjusted Gross Income (AGI) on Form 1040-NR?
a. $0
b. $2,000
c. $6,000
d. $8,500

27. What is on the line for Itemized Deductions on Form 1040-NR?
a. $0
b. $80
c. $7,920
d. $8,000

28. What is the amount on the line for taxable income on Form 1040-NR?
a. $0
b. $1,920
c. $5,920
d. $8,420

29. Is $8,000 the total amount entered into Income Exempt from Treaty in Schedule OI?
a. Yes b. No

Scenario 3: Rudra Khatri Test Questions 30-33 (4).
Directions: To answer the following questions, refer to the Form 1040-NR you completed for Rudra Khatri.

30. What amount is entered for wages, salaries, tips, etc. on Form 1040-NR?
a. $25,200
b. $22,375
c. $22,350
d. $17,350

31. What amount is entered on the itemized deductions line on Form 1040-NR?
a. $13,785
b. $13,600
c. $12,550
d. $1,235

32. What is the amount of federal income tax withheld on Form 1040-NR?
a. $3,985
b. $3,900
c. $2,700
d. $1,050

33. What amount is on the taxable income line of the Form 1040-NR?
a. $21,300
b. $21,140
c. $9,825
d. $9,700

Scenario 4: Gergana Alferov Test Questions 34-37 (4).
Directions: To answer the following multiple choice questions, refer to the Form 1040-NR you completed for Gergana Alferov.
2021 Form W-2 Wage and Tax Statement for Gergana Alferov.

34. What amount is Gergana allowed as a treaty benefit?
a. $15,220
b. $9,000
c. $0

35. What is the amount entered on Form 1040-NR on the line for wages, salaries, tips, etc.?
a. $0
b. $6,220 This is the correct answer per IRS. IRS Error.
c. $9,000
d. $15,220 This should have been the Correct Answer. IRS Error.

36. Where on the tax return will Gergana enter her treaty benefits information?
a. Schedule OI, Line L then carried to Form 1040-NR, Line 1c
b. Form 1040-NR, Schedule A, Line 7
c. Treaty benefits are only subtracted from wages, salaries, tips, etc. and listed on Form 1040-NR, Line 1c.
d. No treaty amounts are allowed without Form 1042-S.

37. What is the amount of itemized deductions that Gergana is entitled to take? And what is her taxable income?
a. $622 and $10,244
b. $622 and $14,598
c. $220 and $6,000 This is the correct answer per IRS. IRS Error.
d. $220 and $15,000 This should have been the Correct Answer. IRS Error.

2021 Part 3 Foreign Student Test – Refunds, Deductions, and the Best Form to Use 38-50:
Introduction: This part of the VITA/TCE certification test includes 13 true/false or multiple choice ques¬tions. Foreign Students, Scholars, Teachers, Researchers and Exchange Visitors: Who Must File and Deductions.

38. Emily, an international student from Ireland, has a Form W-2 that shows amounts withheld for Social Security and Medicare taxes. Emily is an F-1 student who arrived in 2018. What form should Emily use to claim a refund of her Social Security and Medicare taxes withheld?
a. Form 1040-NR
b. Form 8843
c. Form 843

39. Jose and Maria are from Mexico. Jose is a scholar at a local university in J-1 immigra¬tion status and Maria is in J-2 immigration status. Maria worked at a local boutique in 2021. Her Form W-2 shows Social Security and Medicare withholding. Maria found out her spouse does not have to pay Social Security or Medicare taxes. Maria is not eligible for a refund of her Social Security and Medicare taxes withheld.
a. True b. False

40. Li, an international student from People’s Republic of China, received $10,100 of interest income in 2021 from a personal bank account in the U.S. he opened when he first arrived on August 27, 2016. He also had a $100 capital gain from some U.S. stock he sold. What form and schedules does Li need to complete?
a. He does not need to file a return
b. Form 1040-NR, Schedule OI, and Schedule D
c. Form 1040-NR, Schedule D, and Schedule NEC
d. Form 1040-NR, Schedule OI, and Schedule NEC

Question 40 — Explanation: Filing IS required by nonresident students and scholars if you have:
1. A taxable scholarship or fellowship grant, as described in Chapter 1 of Publication 970, Tax Benefits for Education;
2. Income partially or totally exempt from tax under the terms of a tax treaty; and/or
3. Any other income that is taxable under the Internal Revenue Code.
4. Filing IS NOT required by nonresident students and scholars if you have income ONLY from:
1. Foreign sources;
2. Interest Income from
A. U.S. bank
B. U.S. savings and loan institution

41. Arthur entered the United States for the first time in 2019. He is a resident of France, and in F-1 immigration status. Arthur won $1,200 at the local casino.
Does Arthur need to file Form 1040-NR to report the $1,200?
a. Yes b. No

42. George is a visiting scholar from Ireland. He arrived in the U.S. on September 1, 2020 in a J-1 immigration status and was accompanied by his wife Freya and his son Noah. Since his arrival, his second child, Charlie, was born in the U.S. George earned $85,000 in 2021 from State University. When he files his federal tax return, he cannot claim his wife and children as dependents.
a. True b. False

Question 42 — Explanation: Nonresident aliens can’t file a joint return and cannot claim the personal exemptions for a nonworking spouse and U.S. born-children.

43. Quang, a graduate student of physics from Vietnam, is in F-1 immigration status. He first arrived in the U.S. on April 1, 2018. Quang needs help preparing his tax return. He made donations to a U.S. charity and wants to know where to claim them. Quang can claim his charitable contributions as an itemized deduction on Form 1040-NR.
a. True b. False

Question 43 — Explanation: 2021 Form 1040-NR Line 12a Itemized deductions from Schedule A (Form 1040-NR). Gifts to U.S. Charities. Line 2 Gifts by cash or check. If you made any gift of $250 or more, see instructions. Gifts of $250 or more. You can deduct a gift of $250 or more only if you have a written acknowledgment from the charitable organization.

44. Adi is in F-1 immigration status from Chile. He entered the United States in August 2018 and enrolled as a full time undergraduate student. Adi is pursuing his first degree in mathematics. Does Adi qualify to claim any education credit on his Form 1040-NR?
a. Yes b. No

Question 44 — Explanation: Education Credits — If the taxpayer is a nonresident alien for any part of the year, they generally can’t claim the educational credits, such as the American Opportunity Credit and Lifetime Learning Credit.

45. Margarita is a single, nonresident alien who began studying in the U.S.in 2019 in F-1 immigration status from Ecuador. She has wages of $9,300, interest income from her savings account of $175, $50 of dividends, and sold $4,500 of U.S. stocks for a $250 capital gain. She donated $50 of the proceeds to a local charity. Could Margarita have her return completed at a Foreign Student and Scholar VITA site that has properly certified volunteers?
a. Yes b. No

46. Some students and scholars may owe money with their tax return. Nonresidents have which of the following payment options?
a. Ask for an extension of time to pay or an installment agreement.
b. Pay the entire balance by the due date for the return.
c. Put the balance on a credit card.
d. All of the above.

47. Viktor, who is from Russia, earned wages of $12,335 in 2020. He had $280 withheld for state income taxes. He listed the state taxes as a deduction on his federal tax return in 2020, and it lowered his taxable income for 2020. Viktor received a state refund of $200 in 2021 from the 2020 tax return. Viktor does not need to include this state tax refund on his 2021 federal return.
a. True b. False

48. Letizia came to the U.S.in 2018 for postgraduate study. She took out a student loan through the school’s financial aid office to help pay the tuition. Sofia graduated in December 2020, but remained in the U.S. for one year of practical training. She began repaying the loan on August 1, 2021 and paid $65 in interest during 2021. Letizia can claim this interest as an adjustment to income.
a. True b. False

49. Luis, a student from Malta, had $7,500 in wages reported to him on Form W-2. Because all of his wages are excluded from tax by treaty, he is not required to file a tax return.
a. True b. False

50. Shakir is a resident of Egypt attending college in the U.S. He arrived on J-1 immigration status in May of 2019. He had $6,500 in wages and $45 in dividend income. What form/schedule(s) must Shakir complete?
a. Just Form 1040-NR
b. Form 1040-NR, Schedule OI
c. Form 1040-NR, Schedule NEC
d. Form 1040-NR, Schedules NEC and OI

2021 Federal Tax Law Update Test for Circular 230 Professionals with Answers and Explanations:

2021 Federal Tax Law Update Test for Circular 230 Professionals — Certified at 86% Pass Proof;

Directions:
The first three scenarios do not require you to prepare a tax return. Read the inter¬view notes for each scenario carefully and use the Important Changes lesson in Publication 4491, VITA/TCE Training Guide, or in Link and Learn Taxes to answer the questions after the scenarios. All questions are based on calendar year 2021 taxpayers.

Federal Tax Law Update Scenario 1: Herb and Alice Freeman — Interview Notes;
• Herb and Alice are married and file a joint return. Herb is 74 years old and Alice is 70. Neither is blind.
• Both Herb and Alice are retired. Herb works part time as a greeter.
• Herb earned $15,000 in wages. They also received Social Security benefits of $28,000. They received no other income in 2021.
• Both Herb and Alice are U.S. citizens, lived in the United States all year, and have valid Social Security numbers. They do not have any qualifying children, and no one else lives with them.

Federal Tax Law Update Scenario 1: Herb and Alice Freeman — Test Questions;
1. What is Herb and Alice’s standard deduction?
a. $25,100
b. $26,450
c. $27,800
d. $28,500

Question 1 — Explanation:
2. How much of Herb and Alice’s Social Security is taxable?
a. $0
b. $14,000
c. $23,800
d. $28,000

Question 2 — Explanation: How much of your Social Security income is taxable?
Up to 85% of Social Security benefits are taxable for an individual with a combined gross income of at least $34,000 or a couple filing jointly with a combined gross income of at least $44,000. Retirees who have little income other than Social Security generally won't be taxed on their benefits.

3. Herb and Alice qualify for the Earned Income Credit (EIC).
a. True, because their daughter offered to let them claim their grandchild.
b. True, because they have earned income and adjusted gross income under the EIC threshold.
c. False, because their income is too high.
d. False, because they are over the age limit.

Question 3 — Explanation:

Federal Tax Law Update Scenario 2: Chloe Carlow — Interview Notes;
• Chloe, age 48, divorced her husband in 2017.
• Chloe’s 4 year old grandson, Marcus, has been living with her since his parents were incarcerated in August 2019. Chloe provided all the support for Marcus and all the costs of keeping up their home in 2021.
• Chloe worked full time and earned $53,000. She received no other income in 2021.
• Marcus attends daycare while Chloe works. Chloe received a statement from the daycare provider showing she paid $5,980 for Marcus’ care for the year. She did not pay any 2020 expenses in 2021.
• Chloe received the third Economic Impact Payment (EIP 3) of $2,800 in 2021.
• Chloe received advance payments of the Child Tax Credit totaling $1,800 in 2021.
• Chloe and Marcus are both U.S. citizens, lived in the United States all year, and have valid Social Security numbers. No one else lives in the household with them.
Federal Tax Law Update Scenario 2: Chloe Carlow — Test Questions;
4. After reconciling the advance payments, how much Child Tax Credit will Chloe be able to claim on her 2021 federal income tax return?
a. $3,600 b. $3,000 c. $2,000 d. $1,800

Question 4 — Explanation:
IRS Topic H: Reconciling Your Advance Child Tax Credit Payments on Your 2021 Tax Return.

When you file your 2021 tax return during the 2022 tax filing season and half of the total credit amount was paid in advance monthly payments in 2021. You can claim the other half when you file your 2021 income tax return.

The new law for 2021 increases Child Tax Credit to $3,600 for qualifying children ages 5 and under and the credit is fully refundable for 2021. Chloe received advance payments of the Child Tax Credit totaling $1,800 in 2021.

Chloe received advance payments of the Child Tax Credit totaling $1,800 in 2021. Chloe will be able to claim the remaining $1,800 Child Tax Credit on her 2021 federal income tax return?

5. What amount can Chloe claim as qualified dependent care expenses?
a. $3,000 b. $5,980 c. $6,000 d. $8,000

Question 5 — Explanation:
IRS Changes to the credit for child and dependent care expenses for 2021: For 2021, you may claim the credit on qualifying employment-related expenses of up to $8,000 (previously $3,000) if you had one qualifying person, or $16,000 (previously $6,000) if you had two or more qualifying persons and refundable, so you might not have to owe taxes to claim the credit.

6. Which of the following credits are refundable for a taxpayer who lived in the United States for all of 2021? (Select all that apply)
a. Child Tax Credit
b. Earned Income Credit
c. Child and Dependent Care credit
d. Retirement Savings Contribution Credit

Question 6 — Explanation: IRS 2021 Changes to Credits;
IRS There are temporary changes for 2021 to the child and dependent care credit, earned income tax credit, and child tax credit.

IRS Child Tax Credit, prior to taxable year 2021, the credit was worth up to $2,000 per eligible child. The new law increases it to as much as $3,000 per qualifying child ages 6 through 17, and $3,600 for qualifying children ages 5 and under. For eligible taxpayers the credit is fully refundable for 2021. Previously, the refundable portion was limited to $1,400 per child.

IRS Earned Income Credit, you may qualify for the earned income tax credit (EITC) if you worked last year but earned a low or moderate income. EITC is a refundable tax credit, which means that even if you don't owe any tax, you can still receive a refund.

IRS Child and Dependent Care credit for 2021, the American Rescue Plan Act of 2021 increases the amount of the credit for child and dependent care expenses. It also makes the credit refundable. For 2021, you may claim the credit on qualifying employment-related expenses of up to $8,000 (previously $3,000) if you had one qualifying person, or $16,000 (previously $6,000) if you had two or more qualifying persons.

Federal Tax Law Update Scenario 3: Luther and Lexi Lincoln — Interview Notes;
• Luther and Lexi are married and file a joint return.
• Luther and Lexi were enrolled in their Marketplace second lowest cost silver (SLCSP) high deductible health plan (HDHP) with family coverage for all of 2021.Their annual enrollment premium was $10,000 and they received the benefit of an Advance Premium Tax Credit (APTC) of $5,237.
• Lexi received a large bonus from her employer at the end of 2021, which increased their household income to $70,000, which is more than 400% of the Federal Poverty Line (FPL) for the other 48 states and DC. They did not contact the marketplace to inform them of the increase in household income. They were not eligible to claim unemployment at any time in 2021.
• In 2021, Luther contributed $1,500 to his Health Savings Account (HSA). Of that amount, $1,000 was made pretax through his employer’s cafeteria plan and he made the remaining $500 contribution by electronic deposit into the HSA from his checking account. His employer sent Form W-2 reporting $1,000 in Box 12a, with code W. Lexi did not contribute to her HSA.
• Lexi received a Form 1099-SA showing a distribution from her HSA of $700. Lexi has receipts showing they paid $200 for new eyeglasses for Luther, $300 for over the counter allergy medicine for Lexi, and $250 for doctor visit copays and medical tests for Lexi.
• Luther and Lexi donated $450 by check to their local food bank. The food bank is a qualified organization and provided Luther and Lexi with a written acknowledgment of their donation. They contributed $50 in cash to a local family in need. They also donated clothing in good condition with fair market value of $200 to Goodwill. They have a receipt for the donation.
• Luther and Lexi are U.S. citizens with valid Social Security numbers. They do not have enough expenses to itemize their deductions.

Federal Tax Law Update Scenario 3: Luther and Lexi Lincoln — Test Questions;
7. What amount can Luther take as an HSA deduction?
a. $1,500 b. $1,000 c. $500 d. $0

Question 7 — Explanation:
Luther made the remaining $500 contribution by electronic deposit into the HSA from his checking account.

8. How much of Lexi’s Form 1099-SA amount is taxable?
a. $0 because they had qualified medical expenses over $700
b. $150 because Lexi can’t use money from her HSA to pay for Luther’s medical expenses
c. $250 because the over the counter medicine is not a qualified medical expense
d. $700 because all of the contributions were pretax

9. How much of Luther and Lexi’s APTC must be repaid for tax year 2021?
a. $0 IRS New Tax Law Zero is the Correct Answer
b. $1,187 The Test's Correct Answer
c. $2,700 d. $5,237

Question 9 — Explanation: 2021 Excess Advance Premium Tax Credit (APTC) Eligibility.
— IRS For tax years 2021, the American Rescue Plan Act of 2021 (ARPA), enacted on March 11, 2021, temporarily expanded eligibility for the premium tax credit by eliminating the rule that a taxpayer is not allowed a premium tax credit if his or her household income is above 400% of the federal poverty line.

The excess Advance Premium Tax Credit (APTC) repayment amount is Zero with no further action needed by the taxpayer.

Additional Note:
If APTC was paid to your tax family, you must complete Form 8962 to reconcile your APTC with your PTC. If the APTC is more than your PTC, you have excess APTC. If your APTC is less than your PTC, you can get a credit for the difference, which reduces your tax payment or increases your refund.

Important Requirement for the Premium Tax Credit Form 1095-A:
The return cannot be prepared for a taxpayer who received the benefit of APTC for himself without the Form(s) 1095-A.

10. How much can Luther and Lexi deduct for their charitable donations?
a. $0 because they do not have enough expenses to itemize
b. $450 as a charitable contribution deduction
c. $500 as a charitable contribution deduction
d. $600 as a charitable contribution deduction
e. $700 as a charitable contribution deduction

Question 10 — Explanation:
Taxpayers who do not itemize deductions are able to deduct up to $300 of cash contributions to charitable organizations per return. Married couples filing a joint return may deduct up to $600.
Federal Tax Law Update Scenario 4: Kendall and Siena King — Form 1040 Tax Return;
2021 scenario 4 King Documents you need:
2021 Form W-2 Wage and Tax Statement 2021 Form 1099-NEC Nonemployee Compensation 2021 Form W-2G Gambling Winnings 2021 Form 1099-K Payment Card and Third Party Network Transactions 2021 Form 1098-T Tuition Statement from Yuma College
Box 1: Payments received for qualified tuition paid $5,000
Box 8: If you’re enrolled at least half-time during any academic period that began in the calendar year, the school should check this box.
Box 9: This box indicates whether you were a graduate student, the school should check this box.

Federal Tax Law Update Scenario 4: Kendall and Siena King — Interview Notes;
Directions:
Using the tax software, complete the tax return, including Form 1040 and all appropriate forms, schedules, and worksheets answer the questions following the scenario.
Note: When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs as directed, or with any four digits of your choice.

Interview Notes:
• Kendall and Siena are married and file a joint return.
• Siena is an employee and received a Form W-2. Kendall is a self-employed driver for Delicious Deliveries.
• Kendall and Siena had health insurance subsidized by Siena’s employer. They paid $3,600 pre-tax in premiums for the year.
• Kendall provided a statement from the food delivery service that indicated the amount of mileage driven and fees paid for the year. These fees are considered ordinary and necessary for the food delivery business:
— 7,200 miles driven while delivering food
— Insulated box rental: $300
— Vehicle safety inspection (required by Delicious Deliveries): $50
— GPS device fee: $120
• Kendall’s record keeping application shows he also drove 4,125 miles between deliv¬eries and 4,200 miles driven between his home and his first and last delivery point of the day. Kendall has a separate car for personal use. He bought and started using his second car for business on September 1, 2020.
• Kendall also kept receipts for the following out-of-pocket expenses:
— $100 on tolls
— $120 for car washes
— $48 for parking tickets
— $75 for Personal Protective Equipment (PPE) used during deliveries
— $150 for snacks and lunches Kendall consumed while working
• Kendall provided the Form 1099-NEC and Form 1099-K that he received from Delicious Deliveries.
• Kendall also received $300 in cash tips that were not reported elsewhere.
• Kendall won $10,000 on a scratch off lottery ticket. He has $3,000 in losing tickets.
• Siena’s brother Quincy moved in with them in December 2020.He’s a full-time student working on his PhD. He works part-time and earned $3,800 in 2021. Kendall and Siena pay more than half of Quincy’s support. Quincy paid $5,000 in eligible educa¬tional expenses with the proceeds from a student loan. Quincy received a Form 1098-T from Yuma College, EIN 37-700XXXX, showing $5,000 in Box 1 and having boxes 8 and 9 checked.
• Kendall and Siena received the third Economic Impact Payment (EIP 3) in the amount of $2,800 in 2021. Quincy received his own EIP 3 of $1,400 in 2021.
• Kendall, Siena, and Quincy are U.S. citizens, have valid Social Security numbers, and lived in the United States all year.
Federal Tax Law Update Scenario 4: Kendall and Siena King — Test Questions;
11. Which of the following tax benefits do Kendall and Siena qualify for because of Quincy? (Select all that apply)
a. They qualify for a $500 credit for other dependents (ODC)
b. They qualify for a lifetime learning credit
c. They get a $4,300 dependency deduction
d. They do not qualify for any benefits because Quincy is not their dependent.

12. What is the amount of Kendall’s Schedule C gross income?
a. $300 b. $1,800 c. $15,245 d. $17,345

13. What are Kendall’s Schedule C expenses?
a. $6,987 b. $7,305 c. $9,339 d. $9,647

Question 13 — Explanation:
7200 miles driven delivering food + 4125 miles between deliv¬eries = 11325 Total Miles Driven x 0.56 = 6342
Plus GPS device fee: $120 for Commissions and fees.
Plus Insulated Box $300 for Equipment
Plus Safety Inspection $50 for Maintenance
Plus Protective Equipment $75 for Supplies
Plus Tolls $100 for Other Expenses
Grand Total $6987 and the Correct Answer

Additional Note:
The business code is 492000 for food delivery business self-employed driver for Delicious Deliveries.
$120 for car washes is not deductible because it is included in mileage deductions.
$48 for parking tickets is not deductible.
$150 for snacks consumed while working is not deductible.

New IRS Rule for 2021:
Snacks and Lunches IRS new rule for 2021: Snacks and lunches consumed while working is deductible under the new IRS temporary exception. The temporary exception allows a 100% deduction for food or beverages from restaurants, as long as the expense is paid or incurred in 2021.

Beginning January 1, 2021, through December 31, 2022, businesses can claim 100% of their food or beverage expenses paid to restaurants as long as the business owner or an employee of the business is present when food or beverages are provided.
How Long To Keep Your Records and Receipts:
You must keep records as long as they may be needed for the administration of any provision of the Internal Revenue Code. Generally, this means you must keep records that support your deduction (or an item of income) for 3 years from the date you file the income tax return on which the deduction is claimed.

14. How much of Kendall’s gambling winnings is included in adjusted gross income? $_______. 10000

Question 14 — Explanation:
Kendall cannot subtract his $3,000 in losses and report only $7,000 in winnings as other income on Kendall and Siena’s joint federal income tax return.

IRS Can you offset gambling winnings with losses? You may deduct gambling losses only if you itemize your deductions on Schedule A (Form 1040) and kept a record of your winnings and losses. The amount of losses you deduct can't be more than the amount of gambling income you reported on your return.

15. Which of the following statements is true:
a. Kendall can add the $3,600 they paid for health insurance premiums to his self-employment expenses on Schedule C.
b. Kendall can claim the $3,600 they paid for health insurance premiums as a self-employed health insurance deduction on Schedule 1.
c. Kendall can claim his portion of the health insurance premiums, $1,800, as a self-employed health insurance deduction on Schedule 1.
d. Kendall can add his portion of the health insurance premiums, $1,800, to his self-employment expenses on Schedule C.
e. Kendall is not eligible for a self-employed health insurance deduction.

Question 15 — Explanation:
Kendall is not eligible for self-employed health insurance deduction because Kendall is eligible to participate in a health insurance plan maintained by Kendall spouse's employer.

The self-employed health insurance deduction is reported on Line 17 – Schedule 1 (attached to Form 1040) – allows self-employed people to reduce their adjusted gross income by the amount they pay in health insurance premiums during a given year.
GIF Maker the 2022 best free online tool:

IRS Alien Tax Status, Certification of U.S. Residency and Alien Tax Status First-Year Choice:
IRS Determining Alien Tax Status:
If you are currently present in the U.S. and you are not sure about whether you are a resident or nonresident alien for the tax purposes, refer to the IRS Determining Alien Tax Status page.

IRS Certification of U.S. Residency for Tax Treaty Purposes:
You can establish your U.S. residency for tax purposes and claim a tax treaty benefit based on tax treaty with a foreign country.

The IRS provides this residency certification on Form 6166, a letter of U.S. residency certification.

For more information refer to IRS Certification of U.S. Residency for Tax Treaty Purposes page.

IRS Alien Tax Status First-Year Choice:
If you do not meet either the green card test or the substantial presence test for the current year, you can make the first-year choice.

You must attach a statement to Form 1040 to make the first-year choice.

For more information visit IRS Alien Tax Status First-Year Choice page.

California Tax Education Council (CTEC) 60-Hour Qualifying Education Course. 43-Hours Federal Tax Law Course and 2-Hour Ethics Course and 15-Hour California Tax Law Course .

2021-01-24T17:25:00.000-08:00

California Tax Education Council (CTEC) — 60-HOUR QUALIFYING EDUCATION COURSE.

California Tax Education Council (CTEC) — 60-HOUR QUALIFYING EDUCATION COURSE Table of Contents;

About CTEC 60-Hour Qualifying Education Course:
CTEC 60-Hour Course is the first step to becoming a tax professional in California and to prepare taxes for compensation.

CTEC 60-hour course Table of Contents:

43-Hours of federal tax law topics,
2-hours of ethics, and
15-hours of California tax law topics.
Tax Practice Internal Revenue Code.
Tax Code, Regulations and Official Guidance (Internal Revenue Code).

Laws Governing Tax Practice:
Any tax professional with the appropriate education, training, and experience is certainly familiar with the U.S. tax code, along with local laws and regulations governing tax practice.

Whether they are working with clients to prepare individual tax returns, working as an accountant for a company, or providing professional tax advice, or interfacing directly or indirectly with the IRS is obligated to bound to code of conduct known as Circular 230.

As an official publication of the governing body of the IRS, the Department of the Treasury, Circular 230 is the defining standard of conduct for any Certified Public Accountant, Enrolled Agent, tax attorney, and anyone else working as a taxation professional.

The document, available on the IRS website, is complex, but tax professionals don’t need to read it line by line to understand it and use it in their practice.

California Tax Education Council (CTEC) — 43-HOUR CALIFORNIA TAX LAW COURSE.

California Tax Education Council (CTEC) — 43-HOUR CALIFORNIA TAX LAW, SCENARIOS and EXAMINATION Tabke of Contents;
BASIC INCOME TAX FORMULA
Income
— Deductions from income
== Tax Liability
— Tax Payments and Tax Credits
== Refund or Tax Due

California Tax Education Council (CTEC) — 2-HOUR ETHICS COURSE.

California Tax Education Council (CTEC) — 2-HOUR ETHICS COURSE Table of Contents.
2-HOUR ETHICS PROFESSIONAL COURSE
The course is based on 2020 Internal revenue Circular 230 ethics tax code.
This intermediate self-study course covers Federal Tax Preparer Ethics and is eligible for 2-hours of CPE credits.

THE IMPORTANCE OF ETHICS IN TAXATION:
As the IRS explained in its guide to frequently asked questions concerning Circular 230, the document outlines not only ethical standards that every U.S. tax professional must adhere to, but also the details of what constitutes a violation of those ethical standards and what sanctions may be applied as a result.

Experienced Tax professionals are familiar with IRS Tax Code, Official Guidance and Regulations (Internal Revenue Code) and the IRS Circular 230 Best Practices PDF governing the tax practice.

The Federal tax law begins with the Internal Revenue Code (IRC) in the Title 26, United States Code.

The Internal Revenue Code (IRC) codifies all federal tax laws, including income, estate, gift, excise, alcohol, tobacco, and employment taxes. These laws constitute Title 26, U.S. Code.

Tax professionals must follow the code of conduct known as Circular 230 when they are working with clients to prepare individual or business tax returns, working as an accountant for a company, providing professional tax advice, or interfacing with IRS.

The Treasury Department Circular No. 230 is an official publication of the governing body of the IRS and the defining standard of conduct for any Certified Public Accountant, Enrolled Agent, Tax Attorney, and anyone else working as a tax professional.

The Treasury Department Circular No. 230 (Rev. 6-2014), the current document, is available on the IRS website.

IRS 2021 Important News!
Receive Advance Child Credit Payments Monthly, beginning July 15:
There have been important changes to the Child Tax Credit that will help many families receive advance payments.

The IRS will pay half the total credit amount in advance monthly payments beginning July 15.

You will claim the other half when you file your 2021 income tax return. The American Rescue Plan Act (ARPA) of 2021 expands the Child Tax Credit (CTC) for tax year 2021 only.
California Tax Education Council (CTEC) — 15-HOUR CALIFORNIA TAX LAW COURSE.

California Tax Education Council (CTEC) — 15-HOUR CALIFORNIA TAX LAW, SCENARIOS and EXAMINATION Tabke of Contents;

IRS Enrolled Agent Exam Review Course SEE Part 1 — Individuals, SEE Part 2 — Businesses and SEE Part 3 — Representation, Practices and Procedures May 3, 2021 – February 28, 2022 Testing Cycle

2021-01-22T14:59:00.084-08:00

SEE Part 1 — Individuals

2021 IRS SEE Study Materials and SEE How to Pass the Exam:
2021 IRS SEE Study Materials:
1. When studying for the examination, you may wish to refer to the Internal Revenue Code, Treasury Department Circular 230 and IRS forms, instructions and publications available at IRS forms, instructions and publications.

2. IRS Tax Topics may also be useful when studying for the SEE. IRS Tax Topics contain general individual and business tax information. IRS Tax Topics is available at IRS Tax Topics.

How to pass 2021 SEE:
Rule Number 1: Never lose sight of the purpose of the examination. The purpose of the examination is – to ensure that the successful applicant has demonstrated a minimum level of competence necessary to represent a taxpayer before the IRS. And for that reason, you can expect the majority of the questions on the exam to test the Basics of Taxation Fundamentals.

Rule Number 2: The more previous exam questions you review, the better. For one thing, the IRS Prometric SEE Candidate Information Bulletin provides detailed lists of possible topics for each part of the exam to get a flavor of the questions and the depth of knowledge expected on the SEE.

International Student & Scholar IRS VITA Tax

2021-01-20T15:46:00.186-08:00

International Student Higher Education Loan - Private International Student Loan Information!
– Can an international student and resident alien with a valid social security number (SSN) apply for a Federal Student Loan?

– No. Undocumented students, including DACA students, are not eligible for Federal Student Aid.
– However, you may be eligible for state or college financial aid, in addition to private scholarship or a Private Loan.

– As an International Students, you don't have the money for your college to attend and pay tuition.

– With MPOWER Financing for your college loan, you're not required to have a Co-Signer, Collateral or a Credit history. To get a loan apply here.
WHAT IS IRS FORM 8843 FOR?
– As an International Student you must file Form 8843 to explain and document the basis of your claim that you can exclude days present in the United States for purpose of the Substantial Presence Test because:

You were an exempt individual.

You were unable to leave the United States because of a medical condition or medical problem.

– The Form 8843 deadline for tax year 2020 must be postmarked on or before June 15, 2021.

– If you also must file the Form 1040-NR due to wages earned from employment, the Form 8843 must be sent with the Form 1040-NR on or before April 15, 2021, extended to May 17, 2021, and if you ARE NOT ENCLOSING A PAYMENT, then use this address:
Department of the Treasury
Internal Revenue Service
Austin, Texas 73301-0215
USA
-And if you ARE ENCLOSING A PAYMENT, then use this address:
Internal Revenue Service
P.O. Box 1303
Charlotte, NC 28201-1303
USA
– If you don't have to file a tax return, only the Form 8843 by itself, then mail Form 8843 to this address:
Department of the Treasury,
Internal Revenue Service,
Austin, TX 73301-0215 by the due date June 15, 2021.

WHO IS REQUIRED TO FILE IRS FORM 8843 ONLY?
– You will have to submit Form 8843 only if:

You were present in the US in the previous tax year;

You are a non-resident student;
You are in the US under F-1, J-1, F-2 or J-2 visa status, who are non-residents for tax purposes;

You had no U.S. source income in 2020 OR

Your only U.S. source income was bank or credit union interest OR

You are in a degree program, received a fellowship or scholarship and all of that fellowship or scholarship was applied to tuition, fees, books, and supplies or equipment required for your courses.

WHO IS CONSIDERED RESIDENT OR NONRESIDENT FOR FEDERAL TAX PURPOSES?
– International undergraduate students on J-1 or F-1 visas status are automatically considered non-residents for first five calendar years in the U.S.

– Scholars or Researchers on J visas status are automatically considered non-residents for two out of the last six calendar years in the U.S.

– If you’ve been in the U.S. for longer than the five or two year periods, the Substantial Presence Test will determine if you’re non-resident of resident for tax purposes.

– If your "Total Days of Presence" is 183 or greater, then you have passed the Substantial Presence Test and you are a resident international student for tax purposes. For more information on the Substantial Presence Test, see the IRS website.
NONRESIDENT NO INCOME TAX FILING:
Are you a nonresident international student, for tax purposes, who earned NO income in 2020?
You must file Tax Form 8843 by June 15, 2021 with the IRS ..

1. All international students, scholars and their dependents, regardless of their age, present in the U.S. under F-1, F-2, J-1, or J-2 nonimmigrant visa status, who are nonresidents for tax purposes, must file Form 8843 [pdf] with the IRS, even if they received NO income in year 2020.

2. Form 8843 [pdf]Statement for Exempt Individuals and Individuals With a Medical Condition is an informational statement required by the U.S. Internal Revenue Service (IRS) for students or scholars, and their dependents, if they were present in the U.S. during 2020 under F-1, F-2, J-1, or J-2 non immigration visa status and are nonresident for tax purposes, including their spouses and dependents.

3. You do not need to apply for an Individual Taxpayer Identification Number (ITIN) if you are International student or scholar, for tax purposes and you need to file Form 8843. But if an ITIN has been issued, the ITIN number should be included on Form 8843.

4. On the other hand, you do need to apply for an Individual Taxpayer Identification Number (ITIN) for the individuals who are eligible to be claimed as dependents on your U.S. income tax return Form 1040-NR.

If your dependents are eligible to be claimed on U.S. income tax return Form 1040-NR, they must apply for a Taxpayer Identification Number (ITIN).

5. If you are a student holding F-1 or J-1 visa status, you are eligible to claim your spouse and dependents on your tax return Form 1040-NR only if you are from following tax residence countries:

Canada

Mexico

India

South Korea

6. How can Students from Canada Complete their Form 8843?

Canadian students, who are exempt individuals, need to complete and mail their Form 8843 to the IRS using their student visa status.

If they do not have a student visa status, they can use the information from their work authorization papers to complete the Form 8843.

7. If you don't have to file a 2020 tax return, mail Form 8843 to by June 15, 2021 to the address:

Department of the Treasury
Internal Revenue Service Center
Austin, TX 73301-0215

NONRESIDENT INCOME TAX FILING:
1. If you are a Nonresident International Student, for tax purposes, with U.S. source of income you’re required to file Form 1040-NR, if you own money, to pay U.S. income tax only on U.S. source income.

2. Therefore, if you are required to file both, Form 8843 and Form 1040-NR, attach Form 8843 to the back of your tax return Form 1040-NR and mail the both documents to the IRS if Form 1040-NR is filed by paper only.

3. If Form 8843 is for a spouse or a dependent eligible to be claimed as a dependent on a federal tax return, Form 8843 for each one of them must be filed and attached to the back of the tax return Form 1040-NR on which they are claimed, if filed paper only return.

If you want to E-File your Form 1040-NR, you can use TaxSlayer software. We are using TaxSlayer software for free. But the free version does not E-File.

4. If your tax return is paper return only, mail the paper tax return Form 1040-NR and the Form 8843 together, by the due date, to the address shown in the tax return instructions.

5. If not enclosing a payment, mail Form 1040-NR and the Form 8843 to the address: Internal Revenue Service Austin, TX 73301-0215 U.S.A.

6. If enclosing a payment, mail Form 1040-NR and the Form 8843 to the address: Internal Revenue Service P.O. Box 1303 Charlotte, NC 28201-1303 U.S.A.
International Student Tax Form 8843, Filing Wizard;
– All international students and scholars with F or J visa status and their dependents are required to complete and submit IRS Form 8843 each year.

– We have designed the Form 8843 Filing Wizard for the entire year, from January 1 to December 31 to make the completion of the IRS Form 8843 easier for you. Part II is for scholars and Part III is for students, and their dependents.

– Our Form 8843 Filing Wizard will walk you through of the Form 8843 filing process and will help you to make sure that you submit all the required information to the IRS, and will provide you with valuable tips as well.

– If you need to complete Form 8843 as a professional athlete Part IV, or as an individual with a medical condition or medical problem Part V, you may need a professional help to complete the Form 8843.

– If you have been in the USA as an international student for more than 5 calendar years and/or you are not sure whether you are a resident or non-resident, see the IRS Determining Alien Tax Status page.
How to use our Form 8843 Filing Wizard:
– Download IRS Form 8843.pdf

– Answer all the Form 8843 Filing Wizard questions and then transfer all the answers to the PDF form of IRS Form 8843.

– When you’re done, sign and date the form. You will then need to mail the completed form to the IRS for processing.

– You may also contact Sprintax or Glacier Tax Prep for more assistance. Sprintax or Glacier

We immediately discard all data associated with this form, and will not store, save or share any of the information you enter.
Getting started:

– Make sure you have the following documents before starting:

Your Passport and Passport Number;

Your Form I-94 Arrival – Departure Record;

Your visa status Form I-20, for F visa status holders;

Your visa status Form DS-2019, for J visa status holders;

Your Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN);

Form W-2, Wage and Tax Statement; 1042-S, Foreign Person’s U.S. Source Income; Form 1098-T, Tuition Statement and Forms 1099; (Only if you’re filing Forms 8843 and 1040-NR).

– The Top portion and the Part 1, General Information portion, of the Form 8843 is going to be the same for all international students, scholars and their dependents.

– So, whether you are in US as an F-1 Student or a J-1 Student or a J-1 Scholar or even an F-2 or a J-2 dependent, you are going to fill out the Top portion and the Part 1 portion exactly the same way.
USING OUR FORM 8843 FILING WIZARD, PREPARE THE FORM 8843 FOR Lee Satō, STUDENT FROM JAPAN.

Lee Satō came to the U.S. to study on August 1, 2018, in F-1 immigration status. Lee’s passport number is 4682936 and it was issued by her home country, Japan.

Lee’s home address is:
5-3 Yaesu 1-Chome, Chuo-ku,
Tokyo 100-8994, Japan

Lee’s address at school is:
Firestone University, 222 Tread Blvd,
Lauderdale, MN 55000

Lee’s U.S. taxpayer identification number is 9NN-NN-NNNN.

Lee is attending Firestone University, 222 Tread Blvd., Lauderdale, MN 55000, tele¬phone 612-555-XXXX. Her specialized program is Alternative Fuel Systems and the director is Professor Marri M. Young, also at 222 Tread Blvd., Lauderdale, MN 55000, telephone 612-555-XXXX ext. 1267.

Lee has not taken steps to apply for permanent residency. Lee had no income, so she is not required to file any other tax forms. Lee has not left the U.S. since arriving.

After completing the Tax Form 8843 for Lee Satō, Student from Japan, review the Summary Review below to make sure you did not miss anything.

Lee Satō Student from Japan Form 8843 Summary Review:

Lee reports her most current non-immigration status F-1 on line 1b.

Lee needs to complete Line 4a, and on Line 4b she needs to put 366 days of exempted presence for 2020.

Lee has to complete only Part I and Part III of Form 8843.

Lee’s Form 8843 for the tax year 2020 is due by June 15, 2021.

– If you have a U.S. taxpayer identification number or social security number enter it in the box on the right, where it says: Your U.S. taxpayer identification number, if any. A taxpayer identification number or social security number is not required to submit this form. However, if you have one, it must be included.

OUR Form 8843 Filing Wizard Completed by Using Lee Satō Scenario.

– Top of Form 8843, Personal Information: Required for everyone completing Form 8843.

00. This Form 8843 Filing Wizard is for the year January 1 – December 31, 2020.

01. Your first name and initial: LEE (as it appears on your passport).

02. Last name: SATO (as it appears on your passport).

03. Your U.S. taxpayer identification number if any: Not required to submit the IRS Form 8843. If you do not have one, leave it blank. However, if you have one, it must be included 9NN-NN-NNNN.
ITIN: An ITIN, or Individual Taxpayer Identification Number, that is issued by the IRS for tax processing is available for nonresident and resident students or scholars who cannot obtain a Social Security Number (SSN).

04. Address in country of residence: 5-3 YAESU 1-CHOME CHUO-KU, TOKYO 100-8994, JAPAN.

05. Address in the United States: FIRESTONE UNIVERSITY,222 TREAD BLVD. LAUDERDALE, MN 55000.

Part I General Information: Required for everyone completing Form 8843.

06. 1a Type of U.S. visa (for example, F, J, M, Q, etc.) and date you entered the United States ▶ F-1, 08/01/2018

07. 1b Current nonimmigrant status. If your status has changed, also enter date of change and previous status. See instructions. F-1

08. 2 Of what country or countries were you a citizen during the tax year? JAPAN

09. 3a What country or countries issued you a passport? JAPAN

10. 3b Enter your passport number(s) ▶ 4682936

11. 4a Enter the actual number of days you were present in the United States during: 2020 __366__ 2019 __365__ 2018 __153__

12. 4b Enter the number of days in 2020 you claim you can exclude for purposes of the substantial presence test ▶ 366

Part III Students: Required for F-1/J-1 International Students and F-2/J-2 their dependents completing Form 8843.

13. 9 Enter the name, address, and telephone number of the academic or other specified program you participated in during 2020 ▶
FIRESTONE UNIVERSITY
222 TREAD BLVD., LAUDERDALE, MN 55000 (612) 555-1234

14. 10 Enter the name, address, and telephone number of the director of the academic institution you attended during 2020 ▶
PROFESSOR MARRI M. YOUNG, FIRESTONE UNIVERSITY
222 TREAD BLVD., LAUDERDALE, MN 55000 (612) 555-1234 EXT. 1267

15. 11 Enter the type of U.S. visa (F, J, M, or Q) you held during: ▶
2014 2015 2016 2017 2018 __F__ 2019 __F__

16. 12 Were you present in the United States as a teacher, trainee, or student for any part of more than 5 calendar years? No
17. 13 During 2020, did you apply for, or take other affirmative steps to apply for, lawful permanent resident status in the United States or have an application pending to change your status to that of a lawful permanent resident of the United States? No
Signature Section bottom of page 2 of Form 8843:

18. Your signature is required at the bottom of the page 2, Form 8843.

19. Date is required at the bottom of the page 2, Form 8843.

19. Signature and date is required for everyone completing Form 8843 only.

19. Except, if you’re filing and mailing Form 8843 and the paper return Form 1040-NR together, and attaching Form 8843 in the back of your paper tax return Form 1040-NR.

Do not sign the Form 8843 on the bottom of page 2, but include Form 8843 in the same envelope with your income tax return Form 1040-NR.

Question: What is the difference between F and J visa status for international students?

1. The F-1 visa status is used by international students in general. Students are eligible for an F-1 visa status as long as they have been admitted to university.

2. The J-1 visa status is used for international students who are in a specific educational exchange program.
– Review the above details for accuracy, then download the IRS Form 8843 PDF. Transform the information from here to the Form 8843 PDF. And then the form is ready to be signed, dated and mailed to the IRS.

International Student and Scholar IRS VITA Tax FAQs:

Your Passport;

U.S. entry and exit dates, Form I-94 Arrival-Departure Record;

Tax forms W-2, 1042-S and 1099;

F visa status holders Form I-20 or J visa status holders Form DS-2019;

Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN);

You will need to apply for an Individual Taxpayer Identification Number (ITIN), Form W-7, to enable you to file your taxes.

If both, you and your spouse are nonresident aliens, were married and file Form 1040-NR, your only option is to file as single. Married nonresident alien status is treated as a single.

WHAT IS INTERNATIONAL TAXATION?

ACCOUNTING; Certificate of Achievement in Accounting (COA) 2021-2022

2021-01-19T18:27:00.588-08:00

2021-2022 Certificate of Achievement in Accounting (COA);
Courses in the Accounting program provide skills which lead to a number of goals, including career advancement for those already employed, self-employment as a bookkeeper or tax preparer, and completion of many courses needed to take the CPA exam.
Requirements for Certificate of Achievement in Accounting:
Ohlone College: 19 Units Total is required for Certificate of Achievement in Accounting. At $46 per unit your total cost is $874 plus the cost of the Textbooks, unless you can use our free downloads.
Ohlone College requires the following 5 courses for Certificate of Achievement in Accounting:

BA-101A Financial Accounting 5 Units

BA-101B Managerial Accounting 5 Units

BA-102A Principles of Economics-Macroeconomics 3 Units

BA-102B Principles of Economics-Microeconomics 3 Units

BA-125 Introduction to Business 3 Units

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Uber – Lyft Drivers: Let VITA IRS Certified EXPERTS do Your 2019 Tax Return – for FREE!

2021-01-18T19:43:00.000-08:00

IRS Get Refund Status Page Fast:
Click the link here to get to Get Refund Status page fast.

Your Uber – Lyft Driver Tax Return TY 2019 in 9 Easy Steps:

KENNETH KANTER, UBER – LYFT Driver, Quick REFUND SUMMARY:
01 Line AGI = $13,461: Your Adjusted Gross Income from Form 1040, line 8b.
02 Line Federal = -$1,988: Your Federal Tax You Owe.
03 Line State – CA = $129: Your California Tax Refund.

KENNETH R KANTER, UBER – LYFT Driver, 2019 RETURN FORMS LISTING:
01. FORM 1040 (U.S. Individual Income Tax Return)
02. SCHEDULE 1 (Additional Income and Adjustments to Income)
03. SCHEDULE 2 (Additional Taxes)
04. SCHEDULE C (Profit or Loss From Business)
05. SCHEDULE SE (Self-Employment Tax (Section B–Long)
06. FORM 8995 (Qualified Business Income Deduction Simplified)
07. EIC WRKSH B (EIC with No Dependents)
08. FORM 8879 (IRS e-file Signature Authorization)
09. FORM 1040-V (Payment Voucher)
10. FORM 1099-K (Payment Card and Third Party Network Transactions)
11. FORM 1099-MISC (Miscellaneous Income)
12. FORM 540 (California Resident Income Tax Return)
13. FORM 3514 (California Earned Income Tax Credit)
14. FORM 8879 (California e-file Signature Authorization for Individuals)

Kenneth R. Kanter Form 1040 U.S. Individual Income Tax Return 2019, Page 1 and 2, lines 1-16:
01. Filing Status: Single check box;
02. Your first name and middle initial: Kenneth R.
03. Last name: Kanter.
04. Your social security number: 543-00-1234
05. Home address (number and street): 8705 SOMERSBY WAY
06. City, State, and ZIP code: SAN FRANCISCO, CA 94110.
07. Line 7a = $14,485, this is Your Business Income from SCHEDULE 1, line 9. Enter on Form 1040, line 7a.
08. Line 8a = $1024, this is Your Deductible part of Your Self-Employment tax from SCHEDULE 1, line 14. Attach SCHEDULE SE.
09. Line 8b, $13,461 = $14,485 – $1,024, this is Your Adjusted Gross Income (AGI).
10. Line 9 = $12,200, this is Your Standard Deduction for Single tax payer.
11. Line 10 = $252, this is Your Qualified Business Income (QBI) deduction. Attach Form 8995.
12. Line 11b = $1,009, this is Your Taxable income.
13. Line 12a = $101, this is Your Tax from the Tax Table.
14. Line 15 = $2,047, this is Your Self-Employment Tax from SCHEDULE 2, line 10.
15. Line 18a = $160, this is Your Earned Income Credit (EIC).
16. Line 23 = $1988, this is Your Tax You Owe. Tax You Owe = $101 Tax + $2047 SE Tax – $160 EIC and that = $1988, Your Tax You Owe.

Schedule 1, Your Additional Income and Adjustments to Income, KENNETH KANTER, UBER – LYFT Driver:
Part I Additional Income: Lines 01 – 09.
– 01 Name shown on Form 1040: KENNETH KANTER.
– 01 Your social security number: 543-00-1234.
– 02 Check Box: No; At any time during 2019, did you
acquire any financial interest in any virtual
currency?
– 03 Line 3, $14,485; Business income or (loss), Attach
Schedule C.
Enter 14,485 on Schedule 1, line 3, from
SCHEDULE C, line 31 Net profit or (loss),
$14,485 profit.
Enter 14,485 on Schedule SE, line 2.
– 09 Line 9, $14,485; Business income, enter on
Schedule 1, line 9.
– 09 Line 9, $14,485; Enter amount $14,485 on Form
1040, line 7a.

Part II Adjustments to Income: Lines 14 – 22.
– 14 Line 14, $1,024; Deductible part of
      self-employment tax.
      Enter amount $1,024 from Schedule SE, line 13.
      Attach Schedule SE.
– 22 Line 22, $1,024; Amount $1,024 is Your
      Adjustment to Income.
      Enter the amount $1,024 on Schedule 1, line 22.
– 22 Line 22, $1,024; Enter the amount $1,024 on
      Form 1040, line 8a.

SCHEDULE 1 QUICK SUMMARY: KENNETH KANTER, UBER – LYFT Driver 2019 RETURN.

Schedule 2, Your Additional Taxes, KENNETH KANTER, UBER – LYFT Driver:
Part l Tax: N/A.
Part ll Other Taxes: Lines 04 – 10.
– 04 Line 14 = $1,024. Your Deductible part of self-employment tax. Enter amount $1,024 from Schedule SE, line 13. Attach Schedule SE.
– 10 Line 10 = $2,753. Amount $2,753 is Your total other taxes. Enter the amount $2,753 on Schedule 2, line 10.
– 10 Line 10 = $2,753. Enter amount $2,753 on Form 1040, line 15.

SCHEDULE 2 QUICK SUMMARY: KENNETH KANTER, UBER – LYFT Driver, 2019 RETURN.

SCHEDULE C – Profit or Loss From Business, lines 5 – 31, KENNETH KANTER, UBER – LYFT driver:
– 01 Name of proprietor: KENNETH R KANTER
– 01 Social security number (SSN): 543-00-1234
– 01 A Principal business: TAXI LIMOUSINE.
– 01 B Enter code from instructions: 485300.
– 02 F Accounting method: (1) Check the Box Cash.
– 03 G Did you materially participate in this business in 2019: Check Box Yes.
– 04 I Did you make any payments in 2019 that would require you to file Form(s) 1099? Check the Box: No.

• Form 1099-K: $24,000
• Form 1099-MISC: $225
• Cash Tips from customers: $2,745

• Gross profit, line 5: $24,225 (add 1099s)
• Other income, line 6: $2,745 Cash tips;
• Gross income, line 7: $26,970
(add lines 5 & 6).

– 05 Line 5, Gross profit: $24,225 Add two 1099s.
– 06 Line 6, Other income: $2,745 Cash Tips.
– 07 Line 7, Gross income: $26,970.00 Add lines 5 & 6.
$26,970.00 is Your Gross income on SCHEDULE C, line 7.

– 09 Line 9, Car and truck expenses: $7,897.
• You provided statement from Uber or Lyft Company that shows 10,200 miles driven transporting Your customers.
• Your record-keeping application (Stride Tax or MileIQ) shows you drove 3,415 miles between rides.
• Your Total miles driven for your expenses deduction equals to 10,200 + 3,415 and that equals to 13,615 total miles driven.
• Multiply your total mileage driven 13,615 miles by 0.58, your Standard mileage rate; 13,615 X 0.58 = 7,896.7 (7,897 rounded).
• And therefore, your Car expenses on SCHEDULE C, line 9 equal to $7,897.

– 10 Line 10, Commissions and fees: $3,775.
UBER tax summary:
• You provided your tax preparer with Uber tax summary statement from Uber or Lyft Company that shows fees you paid for the year.
These fees are considered ordinary and necessary for the ride-share business, and therefore tax deductible.

• Ride-share fee: $2,800
• Safe driver fee: $140
• Airport fee: $515
• GPS device fee: $320

– 22 Line 22, Supplies (not included in Part III): $415.00.

     • Snacks and Drinks for passengers: $280
     • Auto deodorizers: $15
     • Phone charger for customer use only: $120

– 27 Line 27a, Other expenses (from line 48): $398.

     • Tolls: $138
     • Parking: $260

– 28 – Line 28, Your Total expenses: $12,485
• Add lines 8 though 27a, Your Total expenses: $12,485.

– 29 Line 29, Tentative profit or (loss): $14,485
• Subtract line 28, (Total expenses = $12,485) from line 7, (Gross income = $26,970), and that equals to $14,485 Your Tentative profit or (loss).

– 31 Line 31, Net profit or (loss): $14,485.
• Subtract line 30 (0) from line 29 ($14,845). Enter profit 14,845, on line 31.
• If profit, enter on Schedule 1, line 3.
• If profit, enter on Schedule SE, line 2.

SCHEDULE C – Profit or Loss From Business (Sheet 2), lines 33 – 48, KENNETH KANTER, UBER – LYFT driver.

SCHEDULE C, Part III – Cost of Goods Sold, lines 33, 34, KENNETH, UBER – LYFT driver:
01 – Line 33, Method(s) used to value closing inventory: a Cost. Check box: a.
02 – Line 34, Was there any change in determining quantities, costs, or valuations between opening and closing inventory? Check box: No.

SCHEDULE C, Part IV – Information on Your Vehicle, lines 43 – 47b, and 48, KENNETH, UBER – LYFT driver:
03 – Line 43, When did you place your vehicle in service for business purposes? (month, day, year) 01/06/1917.
04 – Line 44, Of the total number of miles you drove your vehicle during 2019, enter the number of miles you used your vehicle for:
05 – 44a Business miles: 13,615.
06 – 44b Commuting miles: 2,000.
07 – 44c Other miles: 5,225.
08 – Line 45, Was your vehicle available for personal use during off-duty hours? Check box: Yes
09 – Line 46, Do you (or your spouse) have another vehicle available for personal use? Check box: No
10 – Line 47a, Do you have evidence to support your deduction? Check box: Yes
11 – Line 47b, If “Yes,” is the evidence written? Check box: Yes

SCHEDULE C, Part V – Other Expenses, line 48, KENNETH, UBER – LYFT driver:
12 – TOLLS $138.
13 – PARKING $260.
14 – Line 48, Total other expenses. Enter here and on line 27a. $398

– 9 Car and truck expenses, line 9: $7,897.
     • You provided statement from Uber or Lyft Company that shows 10,200 miles driven transporting Your customers.
     • Your record keeping application (Stride Tax or MileIQ) shows you drove 3,415 miles between rides.
     • Your Total miles driven for your expenses deduction equals to 10,200 + 3,415 and that equals to 13,615 miles driven.
     • Multiply your total mileage driven 13,615 miles by $0.58, your Standard Mileage Rate; 13,615 X 0.58 = 7,896.7 (7,897 rounded).
     • And therefore, your Car expenses on Schedule C, line 9 equal to $7,897.

– 10 Commissions and fees, line 10: Total = $3,775
        Uber tax summary:
     • You provided tax preparer with Uber tax summary statement from Uber or Lyft Company that shows fees you paid for the year.
     • These fees are considered ordinary and necessary for the ride share business, and therefore tax deductible.

     • Ride-share fee: $2,800
     • Safe driver fee: $140
     • Airport fee: $515
     • GPS device fee: $320

– 22 Supplies, line 22: Total = $415

     • Snacks and Drinks for passengers: $280
     • Auto deodorizers: $15
     • Phone charger for customer use only: $120

– 27a Your Other expenses (from line 48), line 27a. Total = $398
Line 48, Total Other Expenses. Enter here (line 48) and on line 27a.

– 28 Schedule C,line 28, Your Total expenses.
• Add lines 8 though 27a, total expenses = $12,485.

– 29 Schedule C,line 29, Your Tentative profit or (loss).
• Subtract line 28 (Total expenses = $12,485) from line 7, (Gross income = 26,970), and that equals to 14,485 Your Tentative profit or (loss).

– 31 Schedule C, line 31, Net profit or (loss).
• Subtract line 30 (0) from line 29 ($14,845). Enter profit 14,845, on line 31.
• If profit, enter on both Schedule 1, line 3 and on Schedule SE, line 2.

3. Schedule C, lines 43 – 47b Information on Your Vehicle, Uber – Lyft driver:
– 43 When did you place your vehicle in service for business purposes?
– 44a Business miles.
– 45 Was your vehicle available for personal use during off-duty hours? Yes
– 46 Do you (or your spouse) have another vehicle available for personal use? No
– 47a Do you have evidence to support your deduction? Yes
– 47b If “Yes,” is the evidence written? Yes

4. SCHEDULE SE, lines 2 – 13, Your Self-employment
Tax, KENNETH KANTER, UBER – LYFT driver:

01 Name of person with self-employment income: KENNETH R. KANTER.
02 SSN of person with self-employment income: 543-00-1234.
03 SCHEDULE SE, line 2, Net profit or (loss) from SCHEDULE C, line 31:
From SCHEDULE C, line 31 (14,485), enter Your Net profit (14,485) on SCHEDULE SE, line 2.
04 SCHEDULE SE, line 4a, multiply line 3 (14,485) by 92.35% (0.9235) = 13,377.
Enter amount 13,377 on line 4a. This is important to get the amount on line 6.
05 SCHEDULE SE, line 6, enter 13,377.
06 SCHEDULE SE, line 10. Multiply the smaller of line 6 or line 9 by 12.4% (0.124),
13,377 x 0.124 = 1,659 and enter on line 10. This Your Social Security Self-employment Tax.
07 SCHEDULE SE, line 11, multiply line 6 by 2.9% (0.029) $ 13,377 by 2.9% (0.029) to get $388.
This is your Medicare (hospital insurance) Self-employment Tax.
08 SCHEDULE SE, line 12, Your Self-employment tax. Add lines 10 and 11, 1,659 + 388 = 2,047.
Enter Your Self-employment tax 2,047 on SCHEDULE SE, line 12 and on SCHEDULE 2, line 4.
09 SCHEDULE SE, line 13, Deduction for Your one-half of self-employment tax:
Multiply line 12, (2,047) by 0.50 = 1,024. Enter the amount 1,024 on line 13.
The amount $1,024 is your one-half of your Self-employment tax you can deduct.
You deduct your one-half of your Self-employment tax on SCHEDULE 1, line 14, Deductible part of your Self-employment tax. Attach SCHEDULE SE.

5. Schedule 1, lines 3 – 22, Your Additional Income and
Adjustments to Income, Uber – Lyft driver:
– Check Box No for at any time during 2019, did you receive, sell, exchange, or otherwise acquire any financial interest in any virtual currency?

– 3 Business income or (loss) = 19,485, enter on Schedule 1, line 3. Attach Schedule C.

– 9 Business income = 19,485, enter on Schedule 1, line 9.

–7a Enter Business income = 19,485 on Form 1040, line 7a.

–14 Schedule 1, line 14. Deductible part of self-employment tax. Enter amount 1,377 from Schedule SE, line 13. Attach Schedule SE.

–22 The amount on Schedule 1, line 14 = 1,377. This is Your adjustment to income. Enter the amount 1,377 on Schedule 1, line 22.

–8a Enter amount 1,377 on Form 1040, line 8a.

6. Schedule 2, lines 4 – 10, Your Additional Taxes,
Uber – Lyft driver:
– 4 Schedule 2, line 4, Self-employment tax. Attach Schedule SE. From Schedule SE line 12 = 2,753 enter on Schedule 2 (Form 1040 or 1040-SR), line 4.

– 10 Schedule 2, line 10. Add lines 4 through 8, and that = 2,753. These are Your total other taxes. Enter on Schedule 2, line 10 and on Form 1040, line 15.

7. Form 8995, lines 1i – 15, Your Qualified Business
Income Deduction, Uber – Lyft driver:
– 1i Form 8995, line 1i, Business Trade: Taxi Limousine. Line 1i (c) 18,108 and this is Your Qualified Business Income.

– 4 Form 8995, line 4. 18,108 is Your Total Qualified Business Income.

– 5 Form 8995, line 5. 18,108 x .20 = 3,622 is Your Qualified Business Income component for deduction.

– 10 Form 8995, line 10. 3,622 is Your Qualified Business Income deduction before the income limitation.

– 11 Form 8995, line 11. 5,908 is Your Taxable Income before Qualified Business Income deduction.

– 14 Form 8995, line 14. Income limitation: Multiply 5,908 x .20 = 1,182. This is Your Qualified Business Income deduction.

– 15 Form 8995, line 15. Qualified Business Income deduction. Line 10 = 3,622, and line 14 = 1,182. Enter the lesser of line 10 or line 14. The lesser = 1,182, enter this amount on line 15 and also on Your Form 1040, line 10. Attach Form 8995.

8. EIC Worksheet B, Form 1040, line 18a, Your Earned Income Credit worksheet, Uber – Lyft driver:

9. Form 1040, lines 4 – 10, Your Additional Taxes, and Form 1040-V, Payment Voucher Uber – Lyft driver:
The Tax Information tab on your partner dashboard (partners.uber.com) will provide everything you need to file your taxes as an independent contractor.
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For your Schedules and Forms it could add up quickly:

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Liberty Street, Building EFGH, Fremont,
CA 94538 or call SparkPoint Fremont (510) 574-2020

Invoice and QUICK SUMMARY KANTER UBER DRIVER 2019 Tax Return:

Your Step-by-Step Guide to file your UBER tax return with 2019 UBER Tax Summary, forms 1099-K and 1099-MISC.

Step 1: How to find your earnings on UBER Tax Summary 2019, 2019 forms 1099-K and 1099-MISC.

Your UBER Tax Summary 2919 Sample;

Your UBER form 1099-K Sample;

You should receive your form 1099-K from UBER by January 31st. You use the amount listed in the Box 1a Gross amount of payment card/third party network transactions to report your income on Schedule C.

The gross amount listed in Box 1a also includes the UBER’s fees. On Schedule C You’ll also deduct the UBER’s fees as your business expense.

Your UBER form 1099-MISC Sample;

You’ll receive form 1099-MISC from UBER if you’ve earned $600 or more for your extra affords as nonemployee compensation. On form 1099-MISC the Nonemployee compensation is listed in Box 7, Nonemployee compensation.

Step 2: How to report your earnings and forms you need to file:

You can either use tax software like TaxSlayer that does the calculation for you, or you can file your own forms manually, if you know what forms to use.

To file your 2019 self-employment tax return you need the following forms:

1. Form 1040, U.S. Individual Income Tax Return 2019;
2. Schedule 1, (Form 1040) Additional Income and Adjustments to Income 2019;
3. Schedule 2, (Form 1040) Additional Taxes 2019;
4. Schedule C, Profit or Loss from Business 2019;
5. Schedule SE, Self-Employment Tax, Section B – Long Schedule SE 2019;
6. Form 8995 Qualified Business Income Deduction 2019;
7. Form 1040-V Payment Voucher 2019;

How to file your own Schedule C Step-by Step:

You can use form 1099-K gross amount from Box 1a ($6,845.00) plus your form 1099-MISC amount from Box 7 ($3,859.00) to get your total gross earnings (“Gross receipts or sales”). Then, report your total gross income on your Schedule C line 7, as shown below.

Interview Notes – Kenneth R Kanter;
• IRS Form 13614-C 2019 Intake/Interview & Quality Review Sheet;

Part I – Your Personal Information;
1. Your first name: Kenneth, M.I. R., Last name: Kanter. Daytime telephone number: 415-767-0230. Are you a U.S. citizen? Yes.
2. Mailing address: 8705 SOMERSBY WAY, SAN FRANCISCO, CA 94110.
3. Your Date of Birth: 7/11/1963. 4. Your job title: Self-Employed Driver. Kenneth’s marital status: Never Married. Kenneth’s Social Security Number and SS card: 543-00-1234.

Kenneth's Business Information:

– Kenneth is a cash-basis taxpayer who materially participates in the operation of his business.
– Kenneth did not make any payments that would require him to file Form 1099.
– Kenneth uses business code 485300.
– Kenneth had no prior year unalloyed losses.

Kenneth’s Business Income:

• Kenneth received Form 1099-MISC ($3,859.00) and Form 1099-K ($6,845.00) from the ride-share company. On the side, Kenneth also received an additional $5,000 in cash tip income from individual customers NOT included on the Forms 1099.

Kenneth’s Business Deductible Expenses:

1. Kenneth maintained a written record of mileage, reporting 9,075 business miles, and 2,000 commute miles driven between his home and his first and last customer of the day, 5,225 other miles.

2. Kenneth’s record-keeping application shows he drove 2,925 miles between rides.

3. Kenneth provided IRS certified volunteer tax preparer a statement from Uber Company that indicated the amount of mileage driven and fees paid for the year 2019. These fees are considered ordinary and necessary for the ride-share business.

3.1 Car and truck expenses: Total $6,960 on Schedule C, line 9.
– 9,075 miles driven while transporting customers; 9,075 + 2,925 miles between rides = 12,000 Total miles driven x 58 = $6,960 Total Car and truck expenses.

3.2 Commissions and fees: Total $2,775 on Schedule C, line 10.
– Ride-share fee: $1,800
– Safe driver fee: $140
– Airport fee: $515
– GPS device fee: $320 (Total = $2,775)

3.3 Supplies (miscellaneous expenses): Total $415 on Supplies, Schedule C, line 22.
– Snacks for customers: $280
– Auto deodorizers: $15
– Phone chargers for customer use only: $120
– Meals eaten while waiting for customers: $1,200 (Not deductible)

4. Kenneth spent $129 on tolls and $171 on parking, total = $300. Schedule C, Other Expenses. Line 48 Total other expenses. Enter here and on line 27a.

• Kenneth bought the car and placed his car, a 2016 sedan, in service on January 6, 2017. This is Ramon’s only car and it was available for personal use. The total mileage on his car for 2019 was 44,730 miles, off of that 5,225 was personal miles (Other miles).

• Kenneth did not have health insurance last year. If he has a balance due, he will mail the payment.

Note: To ensure the accuracy of the taxpayer’s return the IRS certified volunteer tax preparer should review and complete the applicable sections of the Form 13614-C.

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2021 Puerto Rico VITA Certification Test Level I and Level II;

2021-01-03T14:59:00.335-08:00

2021 Puerto Rico VITA Certification Test Level I:

Resources to Help You Successfully Complete Your Certification Test Level I:

IRS Publication 1321 – 2021 RETURNS Instructions For Bona Fide Residents Of Puerto Rico Who Must File A U.S. Individual Income Tax Return Form 1040 or Form 1040-SR, needed to answer questions correctly;

IRS Publication 4695(PR) – 2021 VITA Puerto Rico Volunteer Test for Volunteers;

IRS Publication 4696(PR) – 2021 VITA Puerto Rico Resource Guide;

Table of Contents Level I and Level II:

Test Contents Certification

Filing Requirements Level I

Source of Income Level I

Standard Deduction Level I

Refundable Child Tax Credit Level I

Adjustments to Income Level II

Itemized Deductions Level II

Social Security Benefits Level II

Foreign Tax Credit Level II

Self Employment Tax Level II

If you are a bona fide resident of Puerto Rico who will file a U.S. Federal Income Tax Return, Form 1040, and claim an exclusion for income earned in Puerto Rico, you will have to make certain adjustments on your return. These special instructions explain the adjustments, and how to make them on your return.

This is an open-book test. You may use Publication 4696(PR), VITA/TCE Puerto Rico Resource Guide, and any other materials that you will use as a volunteer. Please complete the test on your own. You should round all fractions to four decimal places.

This publication is designed to assist you in preparing an accurate paper or software-prepared return using TaxSlayer. It is divided into three major sections—Level I, Level II, and Software Hints.

IRS Publication 4696(PR), VITA/TCE Puerto Rico Resource Guide 2021 RETURNS, provides worksheets, charts, credit eligibility rules, and TaxSlayer® Pro Desktop User Guide.

Always take Publication 4696(PR) to the VITA/TCE tax preparation site with you.

It is a key reference used during the certification and return preparation processes. Free Download From IRS Website;

IRS Publication 4696(PR), VITA/TCE Puerto Rico Resource Guide 2021 RETURNS, provides worksheets, charts, credit eligibility rules, and TaxSlayer® Pro Desktop User Guide.
Always take Publication 4696(PR) to the VITA/TCE tax preparation site with you. It is a key reference used during the certification and return preparation processes.

IRS Publication 4696(PR), VITA/TCE Puerto Rico Resource Guide – CLICK FOR FREE DOWNLOAD From IRS Website.

Link and Learn - 2021 VITA Puerto Rico Level I English Exam:

2021 Puerto Rico Exam – Level I 100% Pass Proof and Level II – English Exam 93% Pass Proof:

The Puerto Rico Level I certification has 15 questions and 2 scenarios. The first 5 questions are designed how to figure the standard deductions to U.S. income.

Use your reference materials VITA Publication 4696(PR) Puerto Rico Resource Guide and Publication 1321 Instructions for Bona Fide Residents of Puerto Rico to answer correctly.

The 2 scenarios require the completion of specific tax forms and schedules. Round all fractions to four decimal places.

5 questions figuring the standard deductions to U.S. income:

Interview Note: Lauren was a resident of Puerto Rico during 2021. She is single and under 65 years of age. She works as a U.S. government employee and her salary was $34,000. She also received income of $6,000 from a part-time job in Puerto Rico not subject to U.S. tax.
1. What is the allowable portion of the standard deduction that Lauren can claim?
A. $10,668 B. $12,400 C. $12,550; D. $14,250
Questions 1 – 5 Explanation: Standard deduction calculation using Worksheet For Puerto Rico Filers Who Do Not Itemize Deductions.

Reference: IRS Publication 1321 2021 Page 3.

Interview Note: German and Elena were residents of Puerto Rico in 2021. They are age 72 and file a joint return. German is retired from the U.S. Postal Service and Elena is retired from the U.S. Veterans Affairs. Their taxable pensions were $28,000 and $42,000, respectively.
2. What is German and Elena's standard deduction?
A. $24,800 B. $25,000 C. $26,100 D. $27,800
Interview Note: Marco is 40 years old, Head of Household, and a resident of Puerto Rico during 2021. Marco has a son who is his dependent.
He informed you that he received the following sources of income:
• $12,500 for a job he performed in the state of Florida;
• $23,200 received from the federal government for services performed in Puerto Rico;
• He also received $6,300 from a part-time job in Puerto Rico that is exempt from federal income tax.

3. What is the allowable portion of Marco’s standard deduction?
A. $12,550 B. $14,700 C. $15,980 And the Correct Answr. D. $18,800

Question 3 Puerto Rico 2021 Standard Deduction Calculation Worksheet:

Interview Note: Frank is a bona fide resident of Puerto Rico, who received Social Security benefits and pension income from the University of Puerto Rico. Does Sebastian have U.S. source income?
4. Does Sebastian have U.S. source income?
A. Yes, he has U.S. source income.
B. No, he does not have U.S. source income.
Question 4 Explanation; Reference Table 1: Determining Source of Income p4696(PR) Page 9.

1. U.S. Social Security Benefits *U.S. Source income by definition (IRC Sec. 861).

*Bona Fide Residents of Puerto Rico should use Publication 915, Social Security Benefits and Equivalent Railroad Retirement Benefits, to determine how much of their Social Security Benefits may be taxable.

2. Pensions Contributions: Where services were performed that earned the pensions.

Interview Note: Carolina is single and received unemployment benefits from the Puerto Rico Department of Labor reported on a Form 1099-G.
5.What is the factor determining source of income for unemployment?
A. Residence of the payee
B. The location of the payer
C. Unemployment compensation is generally considered sourced where the taxpayer performed the underlying services. And the correct answer!
D. None of the above
Question 5 Explanation: The table on page 2 of Publication 1321 Special Instructions For Bona Fide Residents Of Puerto Rico Who Must File a U.S. Individual Income Tax Return (Form 1040 or Form 1040-SR) describes the rules for determining the source of your income.

Unemployment Compensation for U.S. income tax purposes the source of income is where the taxpayer performed the services.

Level I Puerto Rico Test Scenario 1– Astoria Jones:

Interview Notes:

Astoria Jones is employed as an executive secretary.

Astoria is divorced with two children. Delmar is 3 years old and Lucas is 17 years old.

Social Security numbers: Astoria Jones 133-00-XXXX, Delmar Jones, daughter, 599-00-XXXX and Lucas Jones, son, 598-00-XXXX.

If she is entitled to a refund, Astoria would like to receive it via direct deposit.

Astoria has a checking account from Any Town Credit Union Account Number: 54321 Routing Number: 123456789.

Astoria has an Identity Protection Personal Identification Number (IP PIN).

In 2021, Astoria received an Economic Impact Payment (EIP) from the U.S. territory tax agency (the Puerto Rico Department of Treasury) $1,400 for her, plus $1,400 for each qualifying child.

Astoria has not received advance payments of the refundable child tax credit. She has always been a bona fide resident of Puerto Rico.

Based on the information provided by Astoria Jones, complete Form 1040-PR and the required forms and schedules to answer the following questions.

You are a volunteer at site S21014444.

Note: If you are using the Link and Learn Taxes Practice Lab, when entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs with any four digits of your choice.

Click here for a PDF of the Taxpayer Documents and Interview Notes for this exam.
6. What is the amount of the refundable child tax credit on line 3, Part II, in Form 1040-PR?
A. $0 B. $3,443 C. $4,000 D. $6,600 And the correct answer!
Question 6 Explanation: A child’s age determines the amount and how to calculate click Here.
7. What filing status can Astoria use in Form 1040-PR?
A. Head of Household And the correct answer!
B. Married Filing Jointly
C. Married Filing Separately
D. Qualifying Widow

8. Astoria was entitled to receive Advanced Child Tax Credit payments.
True
False And the correct answer!
Question 8 Explanation: Bona Fide residents of Puerto Rico are not eligible to receive advanced Child Tax Credit Payments. They must file a tax return (Form 1040 PR, Form 1040 SS or other Form 1040 series) in order to claim the credit.

Reference: Publication 4696(PR) 2021 Refundable Child Tax Credit page 13.
9. The IRS issues an Identity Protection Personal Identification Number (IP PIN) to protect and confirm taxpayer identity when submitting a tax return. Should the IP PIN be included on the individual income tax return?
True
False
Question 9 Explanation: The IRS Identity Protection Personal Identification Number (IP PIN) is a 6-digit number assigned to taxpayers to help prevent the misuse of their Social Security number on fraudulent federal income tax returns. A new IP PIN will be generated each year.
10. Astoria must have earned income in order to be able to claim the refundable child tax credit.
True
False
Question 10 Explanation: Child Tax Credit is refundable even if no earned income and if taxpayer’s main home is in the U.S. or in the Puerto Rico for more than half the year. But not eligible to receive advance Child Tax Credit payments if main home in Puerto Rico.

Conclusion: Puerto Ricco income is foreign income and excluded income for U.S. income tax purposes. Therefore, if you're a bona fide resident of Puerto Rico with a U.S. filing obligation, generally won't report Puerto Rican source income on a U.S. income tax return.

Level I Puerto Rico Test Scenario 2 – Jordan Padua and Andrea Milan:

Interview Notes:

Jordan Padua and Andrea Milan are married and bona fide residents of Puerto Rico.

Jordan and Andrea’s SSNs are 581-00-XXXX and 582-00-XXXX respectively.

Andrea received a total of $9,800 in unemployment compensation from the Puerto Rico Department of Labor.

Jordan is an accountant for the Puerto Rico Tourism Company; his wages for this year were $42,000.

His contributions for the Social Security and Medicare were $2,604 and $609, respectively.

They have three children under 18 and an older child Henry, who is permanently and totally disabled.

In 2021, they received an Economic Impact Payment (EIP) from the U.S. territory tax agency (the Puerto Rico Department of Treasury) $1,400 for each qualifying child.

Edward Padua, born 3-12-2016, Son, SSN: 583-00-XXXX 5Ys.

Maria Padua, born 3-12-2016, Daughter, SSN: 584-00-XXXX 5Ys.

Barbara Padua, born 4-15-2012, Daughter, SSN: 585-00-XXXX 9Ys.

Henry Padua, born 6-01-2000, Son, SSN: 586-00-XXXX 21Ys.

Based on the information provided by Jordan and Andrea, complete Form 1040-PR and the required forms and schedules to answer the following questions.

You are a volunteer at site S21014444.

Note: If you are using the Link and Learn Taxes Practice Lab, when entering Social Security numbers (SSNs) or Employer Identification Numbers (EINs), replace the Xs with any four digits of your choice.

Click here for a PDF of the Taxpayer Documents and Interview Notes for this exam.
11. What filing status can Jordan and Andrea claim on their return?
A. Single
B. Married Filing Jointly And the correct answer!
C. Head of Household
D. None of the above

12. How many dependents are eligible for the refundable child tax credit?
A. 0
B. 3 And the correct answer!
C. 4
D. 5

13. How much is the refundable child tax credit that Andrea and Jordan are entitled to receive?
A. $3,213
B. $4,200
C. $5,925
D. $10,200 And the correct answer!

14. Which of the following income must be reported on Form 1040 PR or Form 1040 SS, Part II, Line 1 to calculate the modified adjusted gross income?
A. Wages and Interest
B. Taxable Pension and Annuities
C. Taxable Social Securities Benefits
D. All of the above. And the correct answer!

15. Which form should be completed by Andrea and Jordan to claim the refundable child tax credit?
A. Form 870
B. Schedule 8812
C. Form 1040-PR or Form 1040-SS And the correct answer!
D. All of the above.

Link and Learn - 2021 VITA Puerto Rico Level II English Exam:

The First 5 Queations Summary:

The first five questions are designed to measure key competencies related to figuring the allowable portion of itemized deductions to U.S. income;

How to calculate the source of pension income for service performed partly in the U.S. and partly in Puerto Rico;

How to determine the taxable portion of Social Security benefits;

Use VITA Puerto Rico Resource Guide 4696(PR), and Publication 1321 to answer the questions. Round all fractions to four decimal places.

C. $4,650 The Correct Answer;

Interview Notes:
• Adan and Eva are both under age 65 and bona fide residents of Puerto Rico who file a joint return. Adan had self-employed gross income of $30,000 from his business in Puerto Rico.
• Eva works for the federal government and her salary was $45,000. Before calculating the allowable portion, they had the following eligible itemized deductions:

Home mortgage interest: $5,600;

Real estate taxes: $1,400;

Charitable contributions: $750;

Question 2.1 Explanation: Allowable Portion of Deduction – Formula and Calculation.
1. $5,600 Home mortgage interest:
gross income subject to Federal tax $45,000 / divided by
gross income from all sources $75,000 = 0.6 x multiply by
deduction $5,600 = $3,360 allowable portion of deduction.

2. $1,400 Real estate taxes:
$1,400 Real estate taxes x multiply by 0.6 = $840 allowable portion of deduction.

3. $700 Charitable contributions:
$700 Charitable contributions x multiply by 0.6 = $450 allowable portion of deduction.

4. Allowable Portion of Deduction = $4,650 and the correct answer. ($3,360 + $840 + $450)

a. True The correct answer.
2.2 Question Explanation:
Formula: Gross income subject to Federal tax $45,000 / gross income from all sources $75,000 = 0.6 x
U.S. STANDARD DEDUCTION Married filing jointly or Qualifying widow(er) = $25,100
PR Calculated allowable portion of STANDARD DEDUCTION $25,100 x 0.6 = $15,060 and greater than $4,650.

b. No the correct answer

Question 2.3 Explanation:

Bona Fide Residents of Puerto Rico should use Publication 915 to determine how much of their Social Security Benefits may be taxable.

Gross income subject to U.S. tax (include taxable social security benefits); use Worksheet 1 of Pub. 915 to compute your taxable social security benefits).

Your Base amount is: $25,000 / divided by 2 equals = $12,500 and less than $25,300 and if you are single, head of household, or qualifying widow(er);

Worksheet A. You can use Worksheet A to figure the amount of income to compare with your base amount. This is a quick way to check whether some of your benefits may be taxable.
Always take Publication 4696(PR) to the VITA/TCE tax preparation site with you.

It is a key reference used during the certification and return preparation processes. Free Download From IRS Website;

b. $15,600 the correct answer

Question 2.4 Explanation:

15 / 25 = 0.6 x 26000 = $15,600 the correct answer.

Foreign Tax Credit how to Calculation Formula:

Your foreign tax credit cannot be more than your total U.S. tax liability multiplied by a fraction. The numerator of the fraction is your taxable income from sources outside the United States. The denominator is your total taxable income from U.S. and foreign sources.

Therefore 15 / 25 = 0.6 x 26000 = $15,600 the correct answer.

Pay Your Taxes On the Go Using IRS2Go Mobil App

2020-01-22T13:27:00.000-08:00

IRS2Go Mobil App Pay Your Taxes On the Go
Paying your taxes won’t slow you down if you’re on the go this summer. You can easily make a payment using the IRS2Go mobile app. The app allows you to pay with your mobile device using your Checking or Savings Account or by your Debit or Credit Card.

IRS Direct Pay offers you a free and secure way to pay directly from your bank account, and you can also make a debit or credit card payment through a payment processor for a fee. No part of the fee goes to the IRS.

You can download IRS2Go for free from Google Play, the Apple AppStore or the Amazon AppStore.

IRS2Go - Apps on Google Play Check your refund status, make a payment, find free tax preparation assistance (VITA/TCE), sign up for helpful tax tips, generate a login security code, and follow the latest news from the IRS - all in the latest version of IRS2Go.

Download IRS2Go and connect with the IRS whenever you want and wherever you are. IRS2Go is the official app of the Internal Revenue Service.

When installing IRS2Go, you may see a list of Android permissions that the app requests. To help you understand why we ask for certain permissions, we’ve provided a breakdown of the usage.

"Location – Uses the device’s location." The app allows taxpayers to search for nearby Volunteer Income Tax Assistance (VITA) and the Tax Counseling for the Elderly (TCE) locations, which offer free tax help for taxpayers who qualify.

"Photos/Media/Files – Uses one or more of: files on the device, such as images, videos, or audio; the device’s external storage."
The Free Tax Help mapping feature uses these permissions to save map images and data to your phone's storage. This means that your phone won't need to download the same map data every time.

Download IRS2Go for free from the Apple AppStore. Requires iOS 10.0 or later. Compatible with iPhone, iPad, and iPod touch.

Download IRS2Go for free from the Amazon AppStore.
Product Description:
1. Check your refund status.
2. Make a payment.
3. Find free tax preparation and assistance VITA/TCE sites.

IRS.gov
• Payment Options: Pay Online, Installment Plans and More

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Test Contents	Certification
Filing Requirements	Level I
Source of Income	Level I
Standard Deduction	Level I
Refundable Child Tax Credit	Level I
Adjustments to Income	Level II
Itemized Deductions	Level II
Social Security Benefits	Level II
Foreign Tax Credit	Level II
Self Employment Tax	Level II