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H&R BLOCK INCOME TAX
COURSE EXAM WITH 100 %
CORRECT ANSWERS
Question 1: Which of the following is a requirement for
all taxpayers who want to claim the EIC?
a) Live in the U.S. for more than half a year.
b) Have a valid social security number.
c) Have a qualifying child dependent.
d) Have AGI less than $21,430 ($27,380 MFJ).
e) Have a valid social security number.
CORRECT ANSWER: Have a valid social security
number.
Question 2: A combined due diligence penalty of $2,180
would indicate a penalty for which of the following?
a) EIC, CTC/ODC/ACTC, and head of household.
b) EIC, AOTC, and CTC/ODC/ACTC.
c) EIC, AOTC, CTC/ODC/ACTC, and head of
household.
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d) EIC, PTC, CTC/ODC/ACTC, and head of household.
e) EIC, AOTC, CTC/ODC/ACTC, and head of
household.
CORRECT ANSWER: EIC, AOTC, CTC/ODC/ACTC,
and head of household.
Question 3: When dependent care benefits are withheld
from a taxpayer's income, where are they reported by the employer?
a) Form 2441.
b) Form 1040.
c) Box 10 of Form W-2.
d) The employer is not required to report them.
e) Box 10 of Form W-2.
CORRECT ANSWER: Box 10 of Form W-2.
Question 4: All of the following are due diligence
requirements a tax preparer must meet for EIC, AOTC,
CTC/ODC/ACTC, and HOH, EXCEPT:
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a) Investigate and verify the accuracy of information the
taxpayer provides to show eligibility for EIC, AOTC, CTC/ODC/ACTC, and HOH.
b) Complete all worksheets used to compute the credits. If
the worksheet is completed by hand, keep a copy in the taxpayer's client file.
c) Maintain a copy of documents provided by the
taxpayer that the tax preparer relied on when determining credit eligibility. Then record the date the information was obtained and the name of who provided the information.
d) When information provided by the taxpayer appears to
be incorrect, inconsistent, or incomplete, the tax preparer must make additional inquiries to determine if the taxpayer is eligible for the benefit. Then document both the questions asked and responses provided.
e) Investigate and verify the accuracy of information the
taxpayer provides to show eligibility for EIC, AOTC, CTC/ODC/ACTC, and HOH.
CORRECT ANSWER: Investigate and verify the
accuracy of information the taxpayer provides to show eligibility for EIC, AOTC, CTC/ODC/ACTC, and HOH.
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Question 5: When a taxpayer receives Form 1099-R with
no amount entered in box 2a and code 7 entered in box 7,
the entire distribution:
a) Could be partly or entirely taxable.
b) Is never taxable.
c) Is an early distribution and taxable.
d) Has been rolled into a traditional IRA or into another
qualified plan.
e) Is never taxable.
CORRECT ANSWER: Could be partly or entirely
taxable.
Question 6: What is the maximum amount of the
American Opportunity Tax Credit a taxpayer could receive per student?
- $1,650
- $1,800
- $2,000
- $2,500