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  56) Sam paid the following expenses during October 2018 for

Question :   56) Sam paid the following expenses during October 2018 for : 2125629

 

56) Sam paid the following expenses during October 2018 for his son Aaron's spring 2019 college expenses: Spring 2019 semester begins in January 2019:

 

Tuition

$

18,000

Housing

 

8,000

Meal plan

 

3,500

 

In addition, Aaron's uncle paid $500 for college fees on behalf of Aaron directly to the college. Aaron is claimed as Sam's dependent on his tax return. How much of the paid expenses qualify for purposes of the education credit deduction for Sam in 2018?

A) $0.

B) $20,000.

C) $18,000.

D) $18,500.

57) DJ and Nicolette paid $1,600 in qualifying expenses for their daughter Nicole to attend the University of Nevada. Nicole is a sophomore. DJ and Nicolette's AGI is $175,000. What is their maximum allowable American opportunity tax credit after the credit phase-out based on AGI is taken into account?

A) $0.

B) $400.

C) $600.

D) $1,600.

58) Which of the following statements is not true regarding the education credits?

A) The American opportunity tax credit is only available for the first two years of postsecondary education.

B) The lifetime learning credit is limited to $2,000 per taxpayer per year.

C) The American opportunity tax credit is limited to $2,500 per student per year.

D) A taxpayer cannot receive the American opportunity tax credit if he/she has a felony drug conviction.

59) Which of the following statements is true about education credits?

A) A taxpayer may be eligible to claim the education credits regardless of their AGI amount.

B) A taxpayer can use the same qualifying expenses for both the American opportunity tax and lifetime learning credits.

C) A taxpayer cannot claim an American opportunity tax credit or lifetime learning credit in the same year he/she takes a tax-free distribution from a Coverdell Education Savings Account.

D) The lifetime learning credit may be limited by AGI levels and may completely phase out when modified AGI exceeds a certain amount (the amount depending on the tax year).

60) Which of the following statements is not true regarding the education credits?

A) If a dependent pays for qualified expenses, the expenses are deemed paid by the taxpayer.

B) If a relative makes payments for qualified expenses directly to the institution on behalf of the student, the expenses are deemed paid by the student.

C) If a student receives a scholarship that is excluded from gross income, that amount should reduce qualified expenses.

D) Payments made using borrowed funds are not considered qualified expenses.

 

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