Determine the number of personal and dependency exemptions in each of the following independent situations.
a. Leo and Amanda (ages 48 and 46, respectively) are husband and wife and furnish more than 50% of the support of their two children, Elton (age 18) and Trista (age 24). During the year, Elton earns $4,500 providing transportation for elderly persons with disabilities, and Trista receives a $5,000 scholarship for tuition at the law school she attends.
b. Audrey (age 45) is divorced this year. She maintains a household in which she, her ex-husband, Clint, and his mother, Olive, live. Audrey furnishes more than 50% of the household’s support. Olive is age 91 and blind.
c. Crystal, age 45, furnishes more than 50% of the support of her married son, Andy (age 18), and his wife, Paige (age 19), who live with her. During the year, Andy earned $8,000 from a part-time job. All parties live in Iowa (a common law state).
d. Assume the same facts as in (c), except that all parties live in Washington (a community property state).
34. LO.3, 4 Determine the number of personal and dependency exemptions in each of the following independent situations.
a. Reginald, a U.S. citizen and resident, contributes 100% of the support of his parents, who are citizens of Canada and live there.
b. Pablo, a U.S. citizen and resident, contributes 100% of the support of his parents, who are citizens of Panama. Pablo’s father is a resident of Panama, and his mother is a legal resident of the United States.
c. Gretchen, a U.S. citizen and resident, contributes 100% of the support of her parents, who are U.S. citizens but are residents of Germany.
35. LO.3, 4 Determine how many personal and dependency exemptions are available in each of the following independent situations. Specify whether any such exemptions would come under the qualifying child or the qualifying relative category.
a. Andy maintains a household that includes a cousin (age 12), a niece (age 18), and a son (age 26). All are full-time students. Andy furnishes all of their support.
b. Jackie provides all of the support of a family friend’s son (age 20) who lives with her.
She also furnishes most of the support of her stepmother, who does not live with her.
c. Raul, a U.S. citizen, lives in Costa Rica. Raul’s household includes his friend Helena, who is age 19 and a citizen of Costa Rica. Raul provides all of Helena’s support.
d. Karen maintains a household that includes her ex-husband, her mother-in-law, and her brother-in-law (age 23 and not a full-time student). Karen provides more than half of all of their support. Karen is single and was divorced last year.
36. LO.4 Jenny, age 14, lives in a household with her father, uncle, and grandmother. The household is maintained by the uncle. The parties, all of whom file separate returns, have AGI as follows: father ($30,000), uncle ($50,000), and grandmother ($40,000).
a. Who is eligible to claim Jenny as a dependent on a Federal income tax return?
b. Which of Jenny’s relatives takes precedence in claiming the exemption? Explain.
37. LO.3, 4 Sam and Elizabeth Jefferson file a joint return. They have three children, all of whom qualify as dependents. If the Jeffersons report 2013 AGI of $322,000, what is their allowable deduction for personal and dependency exemptions?
38. LO.4, 9 Wesley and Myrtle (ages 90 and 88, respectively) live in an assisted care facility and for years 2012 and 2013 received their support from the following sources.
Percentage of Support
Social Security benefits 16%
Family friend (not related) 12
a. Who is eligible to claim the Federal income tax dependency exemptions under a multiple support agreement?
b. Must Wesley and Myrtle be claimed as dependents by the same person(s) for both
2012 and 2013? Explain.
c. Who, if anyone, can claim an itemized deduction for paying the medical expenses of
Wesley and Myrtle?