WEEK 1
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1-15: The primary objective of the federal income tax law is to raise revenue. What are its secondary objectives?
The secondary objectives of the federal income tax law include economic and social objectives. It also encourages certain activities and industries. Such activities include research in expenses and special tax credits, as well as special incentives provided to the oil and gas industries. It’s used fiscally to stimulate private investment, reduce unemployment, and reduce the effects of inflation on the economy. Socially it encourages or discourages certain socially desirable or undesirable activities like pensions and charitable contributions.
2-4: List the conditions that must be met in order to claim a dependency exemption for qualifying children and qualifying relatives. Briefly explain each one.
The conditions that have to be met for claiming dependency exemption for a qualifying child include:
Identification number- They must have a Social Security number, and that number must be reported on the return.
Citizenship- Dependents must be a citizen of the U.S., Canada, or Mexico for a part of the year.
Joint return- Married dependents cannot file joint returns. Can be done if the dependent files a joint return only to claim a refund of tax withheld
No dependent- Dependents can’t claim exemptions on their own returns
Relationship test- Must be a child of the taxpayer (including natural, adopted, foster, and stepchildren). Can be descendants of any of these.
Age test- Must be under age 19, a full-time student under age 24, or a permanently and totally disabled child.
Abode test- Must live in the same house as the taxpayer for more than half of the year.
Support test- A qualifying child can’t provide more than half of his or her own support during the year.

Along with the conditions listed above, additional conditions that