Question

Kyle and Elena Smith contributed to the support of their two children, Alexandra and Matthew, and Elena's divorced father, Nick. For 2016, Alexandra, a 22-year-old full-time college student, earned $1,700 from a part-time job. Matthew, a 27-year-old full-time graduate student, earned $23,000 from his job as a teaching assistant. Nick received $2,000 in capital gains income and $7,000 in nontaxable social security benefits. Alexandra, Matthew, and Nick are U.S. citizens and were over one-half supported by Kyle and Elena. How many dependency exemptions can Kyle and Elena claim on their 2016 joint income tax return?

A.5
B.None of the other choices are correct.
C.4
D.2
E.3

Answer 1

the correct answer is Option D. Kyle and Elena Smith can claim two dependency exemptions on their 2016 joint income tax return, one for their daughter Alexandra and one for Elena's father Nick; their son Matthew is not eligible.

Step-by-step explanation:

For Kyle and Elena Smith's 2016 joint income tax return, they will be able to claim two dependency exemptions. Alexandra, being a full-time college student under the age of 24 and earning less than $4,050 (the exemption amount for 2016), can be claimed as a dependent as long as she does not provide more than half of her own support.

Matthew, however, cannot be claimed as a dependent for a dependency exemption because he is over the age limit for full-time students (24) and earns more than the exemption amount. Nick, Elena's divorced father, can be claimed as a dependent since his gross income is below the exemption amount and more than half of his support is provided by Kyle and Elena. Therefore, the correct answer is Option D: They can claim two dependency exemptions.