Question

Kyle and Liza are married and under 65 years of age. During 2017, they furnish more than half of the support of their 19-year old daughter, May, who lives with them. She graduated from high school in May 2016. May earns $15,000 from a part-time job, most of which she sets aside for future college expenses. Kyle and Liza also provide more than half of the support of Kyle's cousin who lives with them. Liza's father, who died on January 3, 2017, at age 90, has for many years qualified as their dependent. How many personal and dependency exemptions should Kyle and Liza claim?

a. Three
b. Four
c. Five
d. Two
e. None of these choices are correct.

Answer 1

Kyle and Liza should claim A)three personal and dependency exemptions.

Step-by-step explanation:

Kyle and Liza should claim a. Three personal and dependency exemptions.

To claim a dependent exemption, the dependent must meet certain criteria. May, their 19-year-old daughter, qualifies as a dependent because she is under 19 and provided less than half of her own support. The cousin also qualifies as a dependent because they provide more than half of his support.

Since they are married and under 65 years of age, Kyle and Liza are eligible to claim exemptions for themselves, in addition to the two dependents. Therefore, the total number of exemptions they should claim is three.