Provide an appropriate response.IRS guidelines state that a married person under 65 years of age who can be claimed as a dependent on another person's tax return must file a return if(i) unearned income was over $750; or(ii) earned income was over $3925; or(iii) total of earned and unearned income was at least $5 and your spouse files a separate return and itemizes deductions; or(iv) total of earned and unearned income was more than the greater ofa) $750; orb) earned income (up to $3675) plus $250.Kevin is 25 years old and can be claimed as a dependent by his mother. He had earned income of $3500 and unearned income of $700. Kevin's wife Linda files a separate return but does not itemize deductions. Must Kevin file a return? Explain.

Question

What will be an ideal response?

Answer 1

Yes, Kevin must file a return. He is a married person under 65 years of age who can be claimed as a dependent on another person's tax return. As such, he must file a return if any of (i)-(iv) apply.
(i) does not apply since $700 < $750; 
(ii) does not apply because $3500 < $3925;
(iii) does not apply because although his spouse (Linda) files a separate return, she does not itemize;
(iv) does apply. The total of earned and unearned income ($3500 + $700 = $4200) is greater than both (a) $750 and (b) earned income (up to $3675) plus $250 ($3500 + $250 = $3750). Thus, Kevin must file a return. (Explanations will vary.)