Filing Status Flashcards
Who must file a federal return?
GI > Exemptions
Income in between 10-20k (look at page 4-5 for more info)
If AMT, special taxes (unreported tips, FICA), other taxes, recapture of certain credits , HSA/MSA distributions, net earnings from self-employment $400+, wages of $108.28+ earned from church, advance payments of premium tax credit made.
Can file as MFJ if…
TP was married on the last day of the year.
TP’s spouse died during the year.
TP and spouse did not live apart during the last six months of the year.
Can file as HOH if…
TP pay more than half of the cost of keeping up a home lived in for more than six months by the TP’s qualifying child, parent, or other qualifying relative.
Reasons for MFS
No joint liability; some couples pay less than filing separately.
Can a custodial parent who has released the right to claim the exemption deduction to the noncustodial parent file as HOH?
Yes.
Can a married taxpayer file as HOH?
Yes, if taxpayer files separate return, paid more than 1/2 cost of keeping up his home for tax year, his spouse did not live in the home during the last 6 mos. of year.
Qualifying Widow(er) requirements
Taxpayer’s spouse died w/in last 2 years.
TP was entitled to file joint return in year spouse died.
Taxpayer did not remarry before Jan, 1, current year.
Taxpayer paid more than half the cost of keeping up his/her home.
Taxpayer’s home was the main home for the entire year of the taxpayer’s dependent child or stepchild.
Exemptions for Dependents
Children who lived w/TP.
Children who did not live w/TP due to divorce/separation.
Dependents on line 6c for other reasons.
ITINs
must be reported for alien dependents not eligible for SSNs.
ITIN expiration
ITINs will expire if not used on a fed inc tax return for any year during a period of five consecutive years.
Three basic tests for qualifying child/dependent
- TP is not another’s dependent.
- If files MFJ, cannot be claimed as a dependent.
- Dependent must be U.S. citizen or national or resident alien. Or resident of Canada or Mexico.
qualifying child must meet the following 6 tests
- relationship test (child, adopted child, eligible foster child)
- age test (under 19 or under 24 if full-time student)
- residency test (for 6+ mos)
- support test (over 1/2 support)
- No MFJ
- tie-breaker test if child qualifies for more than one parent (parent, parent child lived w/more, or parent w/highest AGI).
qualifying relative must meet the following 3 tests
- member of household (for entire year) or relationship test (related)
- gross income (
medical benefits for dependents (expanded)
Itemized deduction for medical expenses paid for a dependent.
Tax-free employer coverage of a dependent under an employer’s medical plan.
Tax-free MSA or HSA distributions used for a dependent’s med expenses.
Both parents (even if divorced) can treat the child as a dependent for these types of expenses.
When is Sch. B required for interest income?
If total taxable income > $1,500.
When is Sch. B required if int inc < $1,500?
To report excluded Series EE bonds for qualified education expenses,
seller-financed mortgage interest,
interest received as a nominee,
interest reported is less than the amount reported on Form 1099 due to accrued interest purchased.
Orig issue discount interest reported is less than shown on Form 1099-OID.
Interest reduced by amortizable bond premium.
Tax-exempt interest.
State and local income tax refunds
taxable if deducted in prior year.
Pensions and annuities are fully taxable if:
TP did not contribute to the cost.
TP’s entire cost was recovered before 2015.
Retired public safety officer exclusion
Can exclude from income distributions (up to $3,000) rcv’d from govt retirement plan that were used to pay for health and LT care insurance premiums.
Election is only available if TP retired b/c of disability or reached normal retirement age.
taxable HSA distributions
distributions not used for qualified med expenses of TP, spouse, or dependents are included in GI and subject to a 20% penalty (until age 65).
To qualify for an HSA, an individual:
Must be covered under a high deductible health plan (HDHP).
May not be covered under any non-HDHP health plan.
Cannot be enrolled in Medicare.
Cannot be eligible to be claimed as a dependent on another person’s return.
Excess HSA contributions
Are not deductible if made by or for an individual
Are included in GI of employee if made by employer
Subject to a 6% excise tax unless withdrawn (w/earnings) by return due date.
HSA contributions are reported on Form
8889.
Deductible moving expenses
Costs of moving household goods and personal effects.
Travel expenses for one trip by the taxpayer and each member of the household.
