Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at State University. Joe works as a design engineer for a manufacturing firm while Jessie runs a craft business from their home. Jessie's craft business consists of making craft items for sale at craft shows that are held periodically at various locations. Jessie spend considerable time and effort on her craft business, and it has been consistently profitable over the years. Joe and Jessie own a home and pay interest on their home loan (balance of $220,000) and a personal loan to pay for Lizzie's college expenses (balance of $35,000). Neither Joe nor Jessie is blind or over age 65, and they plan to file as married-joint. Assume that the employer portion of the self-employment tax on Jessie's income is $839. Joe and Jessie have summarized the income and expenses they expect to report this year as follows: Income: Joe's salary Jessie's craft sales $ 129,900 18,480 1,730 Interest from certificate of deposit Interest from Treasury bond funds Interest from municipal bond funds Expenditures : Federal income tax withheld from Joe's wages State income tax withheld from Joe's wages 732 936 $ 13,700 6,560

Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at State University. Joe works as a design engineer for a manufacturing firm while Jessie runs a craft business from their home. Jessie's craft business consists of making craft items for sale at craft shows that are held periodically at various locations. Jessie spend considerable time and effort on her craft business, and it has been consistently profitable over the years. Joe and Jessie own a home and pay interest on their home loan (balance of $220,000) and a personal loan to pay for Lizzie's college expenses (balance of $35,000). Neither Joe nor Jessie is blind or over age 65, and they plan to file as married-joint. Assume that the employer portion of the self-employment tax on Jessie's income is $839. Joe and Jessie have summarized the income and expenses they expect to report this year as follows: Income: Joe's salary Jessie's craft sales $ 129,900 18,480 1,730 Interest from certificate of deposit Interest from Treasury bond funds Interest from municipal bond funds Expenditures : Federal income tax withheld from Joe's wages State income tax withheld from Joe's wages 732 936 $ 13,700 6,560

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter3: Income Sources

Section: Chapter Questions

Problem 72P

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