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What is Emma's most advantageous filing status allowable? OA

Accounting Jan 13, 2021

What is Emma's most advantageous filing status allowable? OA. Married Filing Separately OB. Qualifying widow(er) OC. Head of Household OD. Single
Basic Scenario 7: Emma Davis Using the tax software, complete the tax return, including Form 1040 and all appropri- ate forms, schedules, or worksheets. Answer the questions following the scenario. Note: When entering Social Security numbers (SSNs) or Employer Identification Numbers (EINS), replace the Xs as directed, or with any four digits of your choice. Interview Notes . Emma is 45 years old and single. . Emma has two children, Poppy, age 17 and Sebastian, age 25, who lived with her all year. Sebastian had a part-time job where he earned $4,500 in 2020. Emma paid all the cost of keeping up the home and more than half the support for her children. . Emma received disability pension benefits. She has not reached the minimum retire- ment age of her employer's plan. She also received interest and dividend income. In early January 2020, she went to the local casino and won some money playing the slot machines. During the intake and interview, she mentioned that she had gambling losses of $700. She does not have enough expenses to itemize for the 2020 tax year. Emma made a $100 cash contribution to her daughter's school to help buy masks for students. . . . Emma received a $1,700 Economic Impact Payment (EIP) in 2020.

Expert Solution

Option B Head of the Household

Explanation :

  • Since Ms. Emma is unmarried and Considered to be unmarried in the last date of year.
  • Since Ms.Emma paid more than half of the Up keeping cost of the family.
  • Her two Children are living with her during the year and they are considered to be a qualified persons.

From the above discussion it is quite clear that Ms. Emma able to qualifying the basic conditions of filling return under the status of Head of the Household for tax purpose.

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