Question
Which of the following statements is FALSE regarding a decedent?
A final tax return for a decedent must include their income and deductions up until the date of their passing.
A final tax return is never required for a decedent, regardless of their income level or whether they owe taxes.
If a decedent's gross income exceeds the filing threshold set by the IRS for that tax year, then a final tax return must be filed for a decedent.
When a person passes away, their final tax return needs to be filed for the year of their death.
A final tax return for a decedent must include their income and deductions up until the date of their passing.
A final tax return is never required for a decedent, regardless of their income level or whether they owe taxes.
If a decedent's gross income exceeds the filing threshold set by the IRS for that tax year, then a final tax return must be filed for a decedent.
When a person passes away, their final tax return needs to be filed for the year of their death.
Answers
Answer
Audrey has a bank account at Lending Bank. She received Form 1099-INT, Interest Income, shown below. She has no other interest or dividends to report. Where should this income be reported on Audrey's tax return?
$410 on line 2a and $230 on line 2b of Form 1040.
$640 on line 2a and $0 on line 2b of Form 1040.
$640 on Part I of Schedule B.
$640 on line 2b of Form 1040.
$410 on line 2a and $230 on line 2b of Form 1040.
$640 on line 2a and $0 on line 2b of Form 1040.
$640 on Part I of Schedule B.
$640 on line 2b of Form 1040.
Answered by
GPT-4o mini
The FALSE statement regarding a decedent is:
**"A final tax return is never required for a decedent, regardless of their income level or whether they owe taxes."**
This statement is incorrect because a final tax return is required if the decedent's gross income exceeds the filing threshold set by the IRS for that tax year.
**"A final tax return is never required for a decedent, regardless of their income level or whether they owe taxes."**
This statement is incorrect because a final tax return is required if the decedent's gross income exceeds the filing threshold set by the IRS for that tax year.
Answered by
GPT-4o mini
To determine where Audrey should report her interest income based on the amount from Form 1099-INT, we need to first understand how this income is categorized on the tax return.
Given that Audrey received interest income totaling $640, she must report this income correctly. The IRS Form 1040 has specific lines for reporting interest income:
- **Line 2a** is for "Tax-exempt interest" (which would typically be zero if she only received regular interest).
- **Line 2b** is for "Taxable interest."
Since her total interest income is $640 (which is presumably subject to tax), she would report the following on her Form 1040:
- Line 2a would be $0 (assuming none of the interest is tax-exempt).
- Line 2b would be $640.
However, if Audrey has total interest income of $640 and no qualifying tax-exempt interest, the correct answer would be:
**$640 on line 2b of Form 1040.**
This option accurately reflects how she would report her interest income. If she had more than a certain threshold of interest income and also had other sources of interest to report, she might also need to use Schedule B, but that's not indicated in your scenario.
Given that Audrey received interest income totaling $640, she must report this income correctly. The IRS Form 1040 has specific lines for reporting interest income:
- **Line 2a** is for "Tax-exempt interest" (which would typically be zero if she only received regular interest).
- **Line 2b** is for "Taxable interest."
Since her total interest income is $640 (which is presumably subject to tax), she would report the following on her Form 1040:
- Line 2a would be $0 (assuming none of the interest is tax-exempt).
- Line 2b would be $640.
However, if Audrey has total interest income of $640 and no qualifying tax-exempt interest, the correct answer would be:
**$640 on line 2b of Form 1040.**
This option accurately reflects how she would report her interest income. If she had more than a certain threshold of interest income and also had other sources of interest to report, she might also need to use Schedule B, but that's not indicated in your scenario.
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