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VITA Basic exam for 2015 federal income tax return Question 23.
Question 23 Basic Exam 2015 Vita Tax Program
In the 2015 Basic Certification Course for the VITA tax program, sponsored by the Internal Revenue Service, there is the following question found in IRS booklet form 6744 VITA/TCE Volunteer Assistor’s Test/Retest for 2015 Returns.
For Question 23: What is the amount of credit for child and dependent care expenses on Form 2441, line 11?
Use Basic Scenario 8: Teresa Martin. Her son Mackenzie Martin's date of birth is June 6, 2004.
He is within the age limit, 13 years old for the child and dependent care tax credit. Use form 2441 to calculate the amount on line 11.
Enter on line three $1,575 the amount paid to Stone's child care.
Enter on line four Teresa's earned income $35,300.
Enter on line five her deceased husband's earned income. $1,700.
Enter the smallest of line 3,4,5 on line 6 $1,575.
On line 7 enter Teresa Martin's adjusted gross income from line 38 on the 1040 form. This includes $35,300 salary plus husband's salary $1,700 plus $1,300 from early withdrawal of her pension plus $3,000 unemployment income. The adjusted gross income is $41,300.
Check the percentage for the amount between $41,000 and $43,000 for line 8. This percentage is 0.21 or 21%.
On line nine multiply 0.21 times $1,575. You get $330.75 or $331.
On line 10 the tax liability limit is $3,000. Therefore the child tax credit is within the limit and the answer on line 11 is $331.