1. Look at the Form 1040A you prepared for Lawrence and Theresa. What is the amount on Form 1040A, Line 28?

A. $2,026.
B. $2,019.
C. $2,011. 
D. $2,094.

2. Look at the Form 1040A you prepared for Lawrence and Theresa. What is the amount on Form 1040A, Line 29?

A. $0.
B. $1,000.
C. $700. 
D. $1,100.

3. For 2009, when you figure your credit for child and dependent care expenses, you can choose to include nontaxable combat pay and you can also figure your credit both ways and make the election if it gives you a greater tax benefit.                        

True False

4. For 2009, the amount of credit you can claim is limited to your regular tax (after reduction by any allowable foreign tax credit) plus your alternative minimum tax, if any.

True False

5. You cannot figure your credit for child and dependent care expenses using expenses for care while you were temporarily absent from work.                        

True False

6. To claim the credit for child and dependent care expenses, you (and your spouse if you are married) must have earned income during the year. Earned income includes

A. Wages, salaries, tips, and other taxable employee compensation and net earnings from self employment.
B. Strike benefits and any disability pay you report as wages.
C. Non-taxable combat pay if you elect to include it. 
D. Any of the above.

7. To provide lodging to the housekeeper, you move to an apartment with an extra bedroom. You

A. Cannot count the extra rent and utility expenses for the housekeeper's bedroom as work-related.
B. Can only count the extra utility expenses as work-related.
C. Can count the extra rent and utility expenses for the housekeeper's bedroom as work-related. 
D. None of the above

8. If you received dependent care benefits, your dollar limit for purposes on the credit may be reduced. Dependent care benefits are

A. Amounts your employer paid directly to either you or your care provider for the care of your qualifying person while you work.
B. Fair market value of care in a daycare facility provided or sponsored by your employer.
C. Pre-tax contributions you made under a dependent care flexible spending arrangement. 
D. All of the above.

9. If you are self-employed and receive benefits from a qualified dependent care benefit plan, you

A. Are treated as an employer.
B. Are treated as an employee.
C. Would get a deduction on Form 1040, Schedule C, Schedule E or Schedule F. 
D. All of the above

10. If you exclude dependent care benefits from your income, the amount of the excluded benefits

A. Is not included in your work-related expenses.
B. Reduces the dollar limit on the amount of your work-related expenses you can use to figure the credit.
C. Both A and B above. 
D. None of the above.

11. In 2008, Nathan and Cynthia had childcare expenses of $ 2,900 for their 12-year-old child. Of the $ 2,900, they paid $2,200 in 2008 and $ 700 in 2009. Their adjusted gross income for 2008 was $ 40,000. Sam's earned income of $16,000 was less that Kate's earned income. As a result,

A. A credit for their 2008 expenses paid in 2009 is not allowed in 2008, but it is allowed for 2009.
B. They must use their adjusted gross income for 2008 to compute the amount.
C. They must add $ 154 to their 2009 credit.  
D. All of the above.

12. If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer and you may be subject to

A. Social Security and Medicare taxes.
B. Federal unemployment tax.
C. Federal income tax withholding. 
D. All of the above.

13. If you pay someone to come to your home and care for your dependent or spouse, you may be a household employer and you may be subject to

A. State unemployment tax.
B. Other state employment taxes.
C. Worker's compensation insurance. 
D. All of the above.

14. Disregard community property laws when you figure earned income for the child and dependent care expenses credit.                  

True False

15. You remarried on December 31. Your earned income for the year was $21,000. You new spouse's earned income for the year was $2,300. You paid work-related expenses of $3,000 for the care of your 8-year-old child and qualify to claim the credit. The amount of care expenses you can use to figure your credit is

A. $3,000.
B. $2,300.
C. $0
D. None of the above.

16. You pay $500 a month for the after-school care for your son for all of 2009. Your child turned 13 on June 1. How much of the expenses can you use to figure the credit?

A. $3,000.
B. $6,000.
C. $2,500. 
D. $2,517.

17. If you pay someone to care for your dependent in your home,

A. You may be a household employer
B. You may have to pay employment taxes
C. You can claim the credit for child and dependent care expenses 
D. All of the above

18. To claim the Child and Dependent Care Expenses Credit, you must file _________ for people who file Form 1040, or  _______ for people who file Form 1040A.

A. Form 2441; Form 2441.
B. Form 2441; Schedule 3.
C. Form 2606; Schedule C. 
D. Form 4029; Schedule SE.

19. The child and dependent care expenses must be for the care of one or more qualifying person such as

A. A child who is 18 years old.
B. Your dependent daughter who was under the age of 13 when care was provided.
C. Your parents who are perfectly able to care for themselves.
D. A person who does not live with you as long as they are one of the relatives that do not have to live with you to be claimed as a dependent.

20. Juan and Miriam Johnson are married filing jointly and keep up a home for their two pre-school children. In tax year 2009, they claimed their children as dependents. Juan earned $15,200 and Miriam earned $5,100. They paid $2,000 for each child in work related child care expenses. What is their credit amount?

A. $4,000.
B. $1,280.
C. $880. 
D. $0.