Question

True/False

1. All taxpayers are allowed the full standard deduction ($12,200 for single taxpayers, for example) when filing a tax return.

2. In order to qualify as a dependent a qualifying relative's gross income must be less than $5,000.

3. A child of the taxpayer must be a dependent to be subject to the kiddie tax.

4. The kiddie tax does not apply to a child under 18 until his or her unearned income exceeds $2,200.

5. In general, taxpayers must file a return if their gross income is at least the sum of the total basic standard deduction and the additional standard deduction for age and blindness.

6. The information reporting system makes it more difficult for taxpayers to avoid IRS detection if they omit income from their returns.

Answer 1

1. Most taxpayers are eligible to take standard deduction and not all taxpayers. The standard tax deduction amounts are determined by age and filing status. Hence, the statement "all taxpayers are allowed the full standard deduction when filing a tax return" is false.

Answer is False.

2. The dependant must be taxpayer's qualifying child or qualifying relative. The dependent being claimed must earn less than $4,200 in 2019. Hence, the statement, "In order to qualify as a dependent a qualifying relative's gross income must be less than $5,000" is false.

Answer is False.

3. The kiddie tax applies to children who are dependent and under 19 years or a full time student aged between 19 and 23. Hence, the statement, "A child of the taxpayer must be a dependent to be subject to the kiddie tax" is true.

Answer is True.

4. All net unearned income over a threshold amount of $2,200 is taxed using the brackets and rates for trusts and estates. Hence, the statement, "The kiddie tax does not apply to a child under 18 until his or her unearned income exceeds $2,200" is true.

Answer is True.

5. If a person is US citizen or resident alien, whether he should file a federal income tax return depends on his gross income, age, filing status and whether he is dependent. Hence, the statement, "In general, taxpayers must file a return if their gross income is at least the sum of the total basic standard deduction and the additional standard deduction for age and blindness" is True.

Answer is True.

6. Deliberately under reporting or omitting income is fraudulent and a criminal activity in violation of the tax law. Hence the statement, "The information reporting system makes it more difficult for taxpayers to avoid IRS detection if they omit income from their returns" is true.

Answer is True.