please answer the following questions Lesson 15 260. Tim enrolls in health insur
ID: 2602057 • Letter: P
Question
please answer the following questions
Lesson 15 260. Tim enrolls in health insurance with Ace Insurance Company in January 2016. Tim fails to pay his premiums for November and December 2016 and January 2017. Ace sends Tim a Form 1095-B on January 31, 2017, reporting coverage for every month in 2016. On February 1, 2017, Ace cancels Tim's coverage effective November 1, 2016 Additionally. Ace filed Tim's Form 1095-B with the IRS. Regarding Tim's corrected Form 1095-B, Ace must complete which of the following actions? A. Ace Insurance Company must send Tim a corrected Form 1095-B reporting that Tim was covered only for January through October 2016 B. Ace Insurance Company must file a corrected Form 1095-B with the IRS reporting coverage only for C. D. January through October No action is required by Ace Insurance Company Both A and B 261. At the end of 2016 Sandy was 22 years old and a full-time student. She earned $2.000 working at the Muffin Break after school. Her parents provided her with $10,000 of support for the year. What is Sandy's AMT exemption amount for 2016? A. $2,000 B. $7,400 C. $9.400 D. $10,000 262. The parent of a child under age 18 may elect to include the child's income on their tax return if the child's interest and dividend income (including capital gain distributions) for 2016 was less than what amount? A. $7,150 B. $8,500 C. $9,500 D. $10,500 ©20171 EX-40Explanation / Answer
260.
Option D, since ACE filed form 1095B with IRS, they have to file a corrected form 1095B and mark an “X” in the CORRECTED checkbox. Additionaly, a corrected form needs to be send to Tim also.
261.
Sandy can claim exemption only for the earned income of $ 2000. Since she is a dependent child as per section and does not support more than half oh her expenses, thus whole amount earned from Muffin can be claimed as AMT exemption. Thus answer is Option A, $ 2000.
262.
Option D, $ 10500.As per Topic Number: 553 - Tax on a Child's Investment and Other Unearned Income (Kiddie Tax), If the child's only income is interest and dividend income (including capital gain distributions) and totals less than $10,500, the child's parent may be able to elect to include that income on the parent's return rather than file a return for the child.
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