TAX TRAINEE
Which statement best reflects the general rule regarding income?
A. All income is excluded unless Congress specifically taxes it.
B. Only earned income is taxable.
C. All income is taxable unless a specific law excludes it.
D. Only income reported on a Form W-2 is taxable.
C. All income is taxable unless a specific law excludes it.
Which form should individual taxpayers use to figure their estimated tax?
A. Form 1040-SR.
B. Schedule SE.
C. Form 1040-V.
D. Form 1040-ES.
D. Form 1040-ES.
What is a "dual status" alien?
A. There is no such thing as a "dual-status" alien.
B. A dual-status alien is an individual who is considered to have been both a resident and a nonresident in the same tax year.
C. A dual-status alien is an individual who is married to a U.S. Citizen.
D. A dual-status alien is an individual who is lawfully present in the United States for at least 5 years.
B. A dual-status alien is an individual who is considered to have been both a resident and a nonresident in the same tax year.
Which of the following is considered a supplemental wage?
A. Bonus
B. Municipal bond interest
C. Dividend
D. Child support
A. Bonus
Samantha earns $70,000 in wages, receives $1,500 of municipal bond interest, and claims a standard deduction.Which amount is generally excluded from income?
A. Wages
B. Standard deduction
C. Municipal bond interest
D. All three
C. Municipal bond interest
For the purpose of determining filing status, which of the following taxpayers would be treated as an unmarried individual for the entire tax year?
A. Paula, who got married to Danny on December 31 of the current tax year.
B. Thomas, whose spouse died in March of the tax year.
C. Halle, who is married and lives apart from her spouse.
D. Opal, whose marriage was annulled, but not until January 1 of the following tax year.
D. Opal, whose marriage was annulled, but not until January 1 of the following tax year.
Which taxpayer generally pays both the employee and employer share of Social Security and Medicare taxes?
A. Employee
B. Self-employed individual
C. Investor
D. Retiree
B. Self-employed individual
Under the constructive receipt doctrine, income becomes taxable when:
A. The taxpayer deposits the funds
B. The taxpayer spends the funds
C. The income is available to the taxpayer
D. A tax return is filed
C. The income is available to the taxpayer
Mai-Lin is a citizen of China and classifies as a nonresident alien for U.S. tax purposes. Which of the following income would not have to be reported on Mai-Lin's Form 1040-NR?
A. Passive income from a U.S. partnership interest.
B. Prize winnings from a U.S. lottery ticket.
C. Rental income earned from U.S. rental properties.
D. Income from foreign sources
D. Income from foreign sources
Which item may be excluded from income tax for military personnel?
A. Basic wages
B. Combat pay
C. Interest income
D. Dividends
B. Combat pay
Which of the following is considered earned income?
A. Interest income
B. Dividend income
C. Retirement income
D. Self-employment income
D. Self-employment income
Emilio's 2022 tax return was due April 15, 2023. He filed it early, on January 23, 2023. Later, he finds an error on the return, and wants to amend it, expecting the correction to result in a refund. If he gets it postmarked on or before _____________ he will receive a refund from the IRS.
A. April 15, 2026
B. January 23, 2025
C. April 15, 2025
D. January 23, 2026
A. April 15, 2026
Torie's husband died on January 5, 2024. She has not remarried during 2025, but she has a 15-year-old dependent daughter. Torie's filing status in 2025 should be:
A. Married filing jointly
B. Single
C. Qualifying surviving spouse (QSS)
D. Head of household
C. Qualifying surviving spouse (QSS)
Cash tips are generally:
A. Nontaxable
B. Taxable income
C. Excluded income
D. Tax-deferred income
B. Taxable income
Jaime expects to owe $1,500 in tax for 2025. Her tax liability for the prior year was $0, because she did not work at all that year. Is Jaime required to pay estimated taxes in 2025?
A. Jaime is not required to pay estimated tax for the year.
B. Jaime is required to pay at least $500 in estimated tax for the year.
C. Jaime is required to pay at least $1,000 in estimated tax for the year.wrong
D. Jaime is required to pay estimated tax for the year.
A. Jaime is not required to pay estimated tax for the year.
Larry has been divorced from his wife, Angela, for several years. Angela has primary physical custody of their son, according to their final court decree. Angela did not provide any support for their son, because Larry was providing alimony and child support to Angela. The son lived with Angela all year long, but Angela released her right to claim the child as a dependent to Larry. What is Larry's filing status in this scenario?
A. Married filing jointly
B. Married filing separate
C. Single
D. Head of Household
C. Single
Which of the following items would "carryforward" on a taxpayer's return, requiring a preparer to see the prior-year return?
A. State income tax deduction that was limited by the SALT cap
B. Gambling losses in excess of gambling winnings
C. Suspended passive losses
D. Hobby expenses in excess of hobby income
C. Suspended passive losses
In a claim of right situation, special deduction or credit rules may apply if repayment exceeds:
A. $500
B. $1,000
C. $2,500
D. $3,000
D. $3,000
Ruth and Peter were married on January 9, 2025. Peter died suddenly on November 10, 2025. Ruth did not remarry during the year. She has no dependents. What filing status is available to her?
A. Qualifying surviving spouse (QSS)
B. Married Filing Jointly.
C. She can choose to file Married Filing Jointly OR Married Filing Separately.
D. She can choose to file Single or as a Qualifying surviving spouse (QSS)
C. She can choose to file Married Filing Jointly OR Married Filing Separately.
For members of the Armed Forces, which of the following items is not taxable income?
A. Severance pay.
B. Reenlistment bonuses.
C. Basic Allowance for Housing (BAH).
D. Military wages.
C. Basic Allowance for Housing (BAH).
Which of the following would generally be subject to FICA taxes?
A. Interest income
B. Dividends
C. Wages
D. Retirement income
C. Wages
Which form can be used to request an IRS determination regarding worker classification?
A. W-4
B. SS-8
C. 1099-NEC
D. W-2
B. SS-8
Penny was the victim of identity theft last year. She received an IP PIN from the IRS this year. She plans to use a paid preparer to file her return. How should the IP PIN be used?
A. The preparer should enter Penny's IP PIN on the tax return in the third-party designee area.
B. The preparer should enter Penny's IP PIN on the tax return next to her signature block.
C. The preparer should enter Penny's IP PIN on the tax return in the PTIN section.
D. The preparer does not need to enter Penny's IP PIN on the tax return. It is for her records only.
B. The preparer should enter Penny's IP PIN on the tax return next to her signature block.
In most cases, a child of divorced or separated parents is the qualifying child of the custodial parent. However, the child may be treated as the qualifying child of the noncustodial parent if:
A. If the custodial parent gives verbal consent to the noncustodial parent to claim the child.
B. The custodial parent provides the noncustodial parent with Form 8332 to release the exemption for the child.
C. If the noncustodial parent has a court order allowing him or her to claim the child.
D. None of the answers is correct.
B. The custodial parent provides the noncustodial parent with Form 8332 to release the exemption for the child.
Jianyu is a Chinese citizen who is a foreign student on an F-1 Student Visa. Jianyu is allowed to work part-time on campus as a teaching assistant. He had Social Security and Medicare taxes withheld on his wages in error. Jianyu is a nonresident alien to tax purposes and must file Form 1040NR. What form can he file to request a refund of these taxes?
A. Jianyu may file Form 843, Claim for Refund and Request for Abatement, along with his Form 1040NR to request a refund.
B. Social Security and Medicare taxes cannot be refunded.
C. Jianyu may deduct the taxes that were erroneously withheld as an adjustment to income on his Form 1040NR.
D. Jianyu may request a refund by filing a formal protest with his Form 1040NR
A. Jianyu may file Form 843, Claim for Refund and Request for Abatement, along with his Form 1040NR to request a refund.