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Lee is 30 years old and single. Lee paid all the costs of maintaining his household for the entire year. Determine Lee's filing status in each of the following alternative situations:

Lee is Ashton's uncle. Ashton is 15 years old and has a gross income of 5,000.AshtonlivedinLee′shomefromApril1throughtheendoftheyear.

User Copser
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Final answer:

Lee's usual filing status would be Single, but if his nephew Ashton qualifies as a dependent due to being a minor relative who lived with Lee for more than half the year and for whom Lee provided the majority of support, Lee could potentially file as 'Head of Household'.

Step-by-step explanation:

The question at hand pertains to determining Lee's filing status for tax purposes. Given that Lee is 30 years old, single, and has paid all the costs of maintaining his household for the entire year, his filing status would typically be Single. However, there is a situation described where Lee is supporting his 15-year-old nephew, Ashton, who lives with him for part of the year and has a gross income of $5,000.

If Ashton qualifies as a dependent, which is possible given the details provided (he is a relative, a minor, lived with Lee for more than half the year, and presumably did not provide more than half of his own support), Lee may be eligible to file as a 'Head of Household'. This filing status is beneficial because it often results in a lower tax rate and a higher standard deduction compared to the Single filing status. To qualify as Head of Household, the individual must also be unmarried and have paid more than half the cost of keeping up a home for the year, which according to the scenario, Lee has done.

User Mbottone
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