Filing Status

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Author:
jillenebeth
ID:
81661
Filename:
Filing Status
Updated:
2011-05-06 12:06:06
Tags:
One
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Description:
Becker CPA Review Regulation 1: Filing Status
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  1. Individual Taxation Equation
    • Gross Income
    • -Adjustments
    • =AGI
    • -Standard OR Itemized Deductions
    • -Exemptions
    • =Taxable Income
    • *Federal Income Tax*
    • -Tax Credits
    • Other Taxes
    • -Payments
    • =Tax Due OR Refund
  2. Gross Income Examples (14)
    • 1. Wages
    • 2. Interest
    • 3. Dividends
    • 4. State Tax Refunds
    • 5. Alimony Received
    • 6. Business Income
    • 7. Capital Gain/Loss
    • 8. IRA Income
    • 9. Pension and Annuity
    • 10. Rental Income/Loss
    • 11. K-1 Income/Loss
    • 12. Unemployment Compensation
    • 13. Social Security Benefits
    • 14. Other Income
  3. Adjustments: "Above the Line Deductions" Examples (11)
    • 1. Educator Expenses
    • 2. IRA
    • 3. Student Loan Interest Expenses
    • 4. Tuition & Fee Deduction
    • 5. Health Savings Account
    • 6. Moving Expenses
    • 7. One-Half Self-Employment FICA
    • 8. Self-Employed Health Insurance
    • 9. Self-Employed Retirement
    • 10. interest Withdrawal Penalty
    • 11. Alimony Paid
  4. Itemized Deductions: "Below the Line Deductions" Examples (7)
    • 1. Medical (in excess of 7.5% of AGI)
    • 2. Taxes - State/Local (Income/Sales & Property)
    • 3. Interest Expense (Home & Investment)
    • 4. Charity (Up to 50% of AGI)
    • 5. Casualty/Theft (in excess of 10% of AGI)
    • 6. Miscellaneous (in excess of 2% of AGI)
    • 7. Other Miscellaneous
  5. General Rule for Filing; 3 exceptions
    • Taxpayer must file a return if his or her income is equal to or greater
    • than the sum of exemption + regular standard deduction + increased
    • standard deduction amount for taxpayers 65 or blind.

    • Exceptions:
    • 1. Individuals with $400+ self-employment income
    • 2. dependents who have unearned income and gross income of $950 or more
    • 3. Individuals who receive advance payments of earned income credit
  6. When to File; Rules to Extension
    • April 15 filing Deadline
    • An automatic 6 month extension may be filed but this does not extend any payment deadline
    • Taxpayers outside US on filing date who have business in US or are stationed outside the US are granted an automatic 2 month extension to file (not to pay). Documentation must be provided.
  7. Qualifying Widow(er) (Surviving Spouse) with Dependent Child
    • 1. Two Years After Spouse's Death: a qualifying widower is a taxpayer who may use the joint tax return standard deduction and rates (but not exemption for the deceased spouse) for each of the two taxable years following the year of death of his or her spouse, unless s/he remearries.
    • 2. Principal Residence for Dependent Child: The surviving spouse must maintain a household that, for the WHOLE taxable year was the principal place of abode of a son, stepson, daughter, or stepdaughter (blood or adoption). Foster child doesn't qualify.
  8. Head of Household (4)
    • 1. Not married, legally separated, or married and living apart from spouse for the last 6 months of the year.
    • 2. Individual is not a qualifying widow(er)
    • 3. Not a nonresidential alien
    • 4. Maintains as his or her home a household that, for MORE THAN HALF the year, is the principal residence of:
    • a. dependent son or daughter: must live with taxpayer
    • b. father or mother: (nursing home) doesn't need to live with taxpayer
    • c. dependent relative: must live with taxpayer; cousins, foster parents, and unrelated dependents do not qualify
  9. Widow(er) vs. Head of Household
    • Widow(er): WHOLE year
    • Head of Household: HALF a year (more than)

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