Under which of the following circumstances must a taxpayer itemize his deductions?
1. When the taxpayer has been married for less than one year.
2. When the taxpayer is married and files a separate return and the taxpayer’s spouse itemizes his or her deductions.
3. When the taxpayer is a nonresident alien.
a. 1 and 2.
b. 1 and 3.
c. 2 and 3.
d. 1, 2, and 3.
2. Which of the following is not an available filing status?
a. Qualified dependent child.
b. Married filing jointly.
c. Head of household.
d. Surviving spouse.
3. Cost basis is the initial basis an investor acquires in an asset by using capital to purchase the investment.
a. True
b. False
Which of the following is not excluded from gross income?
a. Gifts.
b. Scholarships.
c. Interest income from municipal bonds.
d. Dividend income.