NEED HELP WITH THESE QUESTIONS 1 Tim rolls over 1250 from hi

NEED HELP WITH THESE QUESTIONS

1. Tim rolls over $1,250 from his Archer Medical Savings Account (MSA) to a Health Savings Account (HSA). What amount of the distribution is subject to California income tax?

a) $0

b) $125

c) $625

d) $1,250

2. Kristen reduced her Federal mortgage interest deduction by $500 (the amount of her mortgage interest credit from Federal Form 8396 - Mortgage Interest Credit). When completing her California tax return she can increase the California itemized deductions for home mortgage interest by what amount?

a) $0

b) $100

c) $250

d) $500

3. Arthur is a California resident. He was ordered to pay $2,000 in alimony and $3,000 in child support to his former spouse. He meets all the requirements when paying his support. What amount can Arthur take as a deduction for these payments?

a) $0

b) $1,000

c) $2,000

d) $3,000

4. Sonny won $1,000 from the California State Lottery and $600 from the Nevada State Lottery. What amount can he exclude from taxable income on his California tax return?

a) $0

b) $500

c) $600

d) $1,000

Solution

Answer is $0 (a)

Amounts can be rolled over into an HSA from another HSA or from an Archer MSA. One-time rollovers are permitted from IRAs to HSAs for taxable years beginning after December 31, 2006.

2.

Answer is (D $500)

If you reduced your federal mortgage interest deduction by the amount of your mortgage interest credit (from federal Form 8396, Mortgage Interest Credit), increase your California itemized deductions by the same amount. Enter the amount of your federal mortgage interest credit as a positive number on other adjustments to CA Itemized Deductions.

3.

Answer is C $2000

Alimony paid is an adjustment from gross income to arrive at Adjusted Gross Income

Nothing can be deducted for the child support payments. Child support payments are neither deductible by the payer nor taxable income to the payee. You may be able to claim the child only if he/she is dependent on you.

4. Answer is C $600

He can exclude the $600 from Nevada state lottery as California, Delaware, and Pennsylvania -- you pay income taxes on your winnings when you file an income tax return, but those three states don\'t withhold money beforehand.

And for Nevada tax is already been deducted before given o you.