Special Rules for those who can be claimed as a dependent on another's persons's tax return, Fall 20

Special Rules for those who can be claimed as a dependent on another's persons's tax return, Fall 20

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Income Tax Accounting 33:010:421 Fall 2010 Special Rules for those who can be claimed as a dependent on another person’s tax return See text page 4-27 to 4-32 and problems 4-43, 4-44, 4-49 and 4-50 which will be gone over in class. The following special rules apply in computing the taxable income of a person who can be claimed as a dependent on another person’s return. 1. The standard deduction of anyone who can be claimed as a dependent on another person’s return is limited to the greater of (1) a minimum standard deduction of $950 or (2) the dependent’s earned income plus $300. In any case the standard deduction can not exceed $5,700—the regular standard deduction for a single person. 2. A person who can be claimed as a dependent on another person’s tax return can not deduct their own personal exemption. Special rules to be followed in computing the tax liability of a child under the age of 19 or a full-time student under the age of 24. (see note below) the so called “kiddie tax”. Step 1
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