Chad and Jaqueline Are Married and Have AGI of $150,000

question 70

Multiple Choice

Chad and Jaqueline are married and have AGI of $150,000.In 2019 they adopted a child,while taking advantage of their employer's written adoption assistance program.The adoption cost $9,500,all of which was paid by the employer in accordance with the adoption plan.How much of the employer-paid adoption costs may be excluded from their income?

• A)$0
• B)$5,000
• C)$5,250
• D)$9,500

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Definitions:

Tax Liability

The total amount of tax that individuals or entities are legally obligated to pay to a taxing authority based on their income, property, or other taxable assets.

Married Filing Jointly

A tax filing status for married couples who choose to combine their income and deductions on one tax return.

Single Filing Status

A tax filing status for individuals who are unmarried and do not qualify for other filing statuses.

Circular 230

A set of regulations governing tax professionals who represent taxpayers before the IRS, ensuring practitioners meet ethical and practice standards.