Jason and Peggy are married, file jointly, and have one dependent (12-year old qualifying child). Jason receives an $87,000 salary. Peggy is self-employed. Her sole proprietorship's revenues are $99,000, and its expenses are $52,000. Jason and Peggy each make a $6,000 deductible contribution to a traditional IRA. Their itemized deductions are $28,000. Federal income taxes of $7,400 are withheld from Jason's paychecks, and Peggy makes $3,400 of estimated tax payments. Read the requirement. First, compute their gross income. Gross income Filing Status Married individuals filing joint returns and surviving spouses $24,400 Heads of households $18,350Unmarried individuals (other than surviving spouses and heads of households)$12,200Married individuals filing separate returns$12,200Additional standard deduction for the aged and the blind; Individual who is married and surviving spouses$1,300*Additional standard deduction for the aged and the blind; Individual who is unmarried and not a surviving spouse$1,650*Taxpayer claimed as dependent on another taxpayer’s return: Greater of (1) earned income plus $350 or (2) $1,100.* These amounts are $2,600 and $3,300, respectively, for a taxpayer who is both aged and blind. If taxable income is: The tax is: Not over $19,400 10% of taxable income. Over $19,400 but not over $78,950 $1,940.00 + 12% of the excess over $19,400. Over $78,950 but not over $168,400 $9,086.00 + 22% of the excess over $78,950. Over $168,400 but not over $321,450 $28,765.00 + 24% of the excess over $168,400. Over $321,450 but not over $408,200 $65,497.00 + 32% of the excess over $321,450. Over $408,200 but not over $612,350 $93,257.00 + 35% of the excess over $408,200. Over $612,350 $164,709.50 + 37% of the excess over $612,350.
Jason and Peggy are married, file jointly, and have one dependent (12-year old qualifying child). Jason receives an $87,000 salary. Peggy is self-employed. Her sole proprietorship's revenues are $99,000, and its expenses are $52,000. Jason and Peggy each make a $6,000 deductible contribution to a traditional IRA. Their itemized deductions are $28,000. Federal income taxes of $7,400 are withheld from Jason's paychecks, and Peggy makes $3,400 of estimated tax payments. Read the requirement. First, compute their gross income. Gross income Filing Status Married individuals filing joint returns and surviving spouses $24,400 Heads of households $18,350Unmarried individuals (other than surviving spouses and heads of households)$12,200Married individuals filing separate returns$12,200Additional standard deduction for the aged and the blind; Individual who is married and surviving spouses$1,300*Additional standard deduction for the aged and the blind; Individual who is unmarried and not a surviving spouse$1,650*Taxpayer claimed as dependent on another taxpayer’s return: Greater of (1) earned income plus $350 or (2) $1,100.* These amounts are $2,600 and $3,300, respectively, for a taxpayer who is both aged and blind. If taxable income is: The tax is: Not over $19,400 10% of taxable income. Over $19,400 but not over $78,950 $1,940.00 + 12% of the excess over $19,400. Over $78,950 but not over $168,400 $9,086.00 + 22% of the excess over $78,950. Over $168,400 but not over $321,450 $28,765.00 + 24% of the excess over $168,400. Over $321,450 but not over $408,200 $65,497.00 + 32% of the excess over $321,450. Over $408,200 but not over $612,350 $93,257.00 + 35% of the excess over $408,200. Over $612,350 $164,709.50 + 37% of the excess over $612,350.
Chapter6: Deductions And Losses: In General
Section: Chapter Questions
Problem 34P
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Question
Jason and Peggy are married, file jointly, and have one dependent (12-year old qualifying child). Jason receives an $87,000 salary. Peggy
is self-employed. Her sole proprietorship's revenues are $99,000, and its expenses are $52,000. Jason and Peggy each make a $6,000 deductible contribution to a traditional IRA. Their itemized deductions are $28,000.Federal income taxes of $7,400 are withheld from Jason's paychecks, and
Peggy makes $3,400 of estimated tax payments.
Read the requirement.
First, compute their gross income.
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Gross income
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Filing Status |
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| Married individuals filing joint returns and surviving spouses | $24,400 | |||||||||
| Heads of households |
$18,350Unmarried individuals (other than surviving spouses and heads of households)$12,200Married individuals filing separate returns$12,200Additional standard deduction for the aged and the blind; Individual who is married and surviving spouses$1,300*Additional standard deduction for the aged and the blind; Individual who is unmarried and not a surviving spouse$1,650*Taxpayer claimed as dependent on another taxpayer’s return: Greater of (1) earned income plus $350 or (2) $1,100.* These amounts are $2,600 and $3,300, respectively, for a taxpayer who is both aged and blind.
| If taxable income is: | The tax is: | |||
| Not over $19,400 | 10% of taxable income. | |||
| Over $19,400 but not over $78,950 | $1,940.00 + 12% of the excess over $19,400. | |||
| Over $78,950 but not over $168,400 | $9,086.00 + 22% of the excess over $78,950. | |||
| Over $168,400 but not over $321,450 | $28,765.00 + 24% of the excess over $168,400. | |||
| Over $321,450 but not over $408,200 | $65,497.00 + 32% of the excess over $321,450. | |||
| Over $408,200 but not over $612,350 | $93,257.00 + 35% of the excess over $408,200. | |||
| Over $612,350 | $164,709.50 + 37% of the excess over $612,350. |
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