I. In 2016, Jenny (age 25) had income of $365 which she earned from selling maga
ID: 2582128 • Letter: I
Question
I. In 2016, Jenny (age 25) had income of $365 which she earned from selling magazine subscriptions. She did not receive a Form 1099-MISC. Because she did not receive a 1090-MiSG, she is not required to report the income on her tax retum. True/False 2. Adele, age 27, received a Form 1099-MISC with $2,125 in box 7 as nonemployee compensation. She worked making phone calls for a catalog company. She had no expenses and had no other income. Adele is required to file a tax return. True/False 3. On your Schedule C, if you do not have an EIN, and are required to have one, you can: A. Use your social security number on line D of Schedule C B. Use the EIN listed on the Form 1099-MISC you received C. Obtain one by completing Form SS-4 and sending it to the IRS. D. Leave line D of Schedulo C blank 4. To claim a business use of home deduction as a self-employed taxpayer, if not using the simplified method, the following form must accompany Form 1040: A. Form 6198 B. Form 8829 C. Form 4562 D. Form SS-4 deductible include all of the following except: A. Furmace repairs B. Painting the home-office C. Refinishing the floor of the home-office D. Repairing the cciling of the home-office 6. Which one of the following statements is true? If you are a self employed farmer, you report your business income and expenses on Schedule C. B. LIFO means that a product that was last produced or purchased is t C. A small business with expenses of $6,000 or less may be able to file D. E. None of the above he product that is considered sold last. Schedule C-E A hobby is not considered a business because its activities are not carried on to generate a profit.Explanation / Answer
Solution 1
Every income has to be taxed. Even though she has not filed form 1099, she has earned an income during the year and she is liable to pay taxes on the earned income to the IRS. Therefore, the given statement is false.
She must show the income in her tax returns.