INDIVIDUAL INCOME TAX
2019th Edition
ISBN: 9780357323410
Author: VALUE EDITION
Publisher: CENGAGE L
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Question
Chapter 10, Problem 3DQ
To determine
Explain the difference for the medical treatment expenses including in the tax returns.
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Students have asked these similar questions
Credits and deductions both reduce your tax bill, but they work differently.
A credit erases money from the amount you owe. You save the full amount.
A deduction reduces your taxable income ONLY IF you itemize deductions. You save a percentage of the deduction depending on your tax bracket. If you don't itemize, it's worthless.
Example: Josie is in the 25% tax bracket and itemizes her deductions. She qualifies for a $500 credit for her new insulated windows, and also a $500 deduction for mortgage interest.
- Credit: Josie saves the full $500
- Deduction: Josie's taxable income is reduced by $500. If she had to pay tax on that $500 she would pay 25% of $500 = $125, so she saves $125. How much more does the credit save Josie than the deduction?
Net pay refers to the amount of take-home pay after taxes and other deductions (healthcare, social security, retirement, etc.). For the purposes of this project we will assume everyone is an unmarried individual with no children. We will assume your net salary is simply your gross salary($123,031) minus your taxes (that you will calculate using the table below) and all of your gross salary will be considered taxable income. Find your net pay. Show all calculations, including descriptions if necessary. Be sure to use the equation editor and label your final solution. Round your solution to the nearest dollar.
Margaret's tax return is prepared, but she does non have the money to pay the amount due. She should?
Chapter 10 Solutions
INDIVIDUAL INCOME TAX
Ch. 10 - Prob. 1DQCh. 10 - Prob. 2DQCh. 10 - Prob. 3DQCh. 10 - Prob. 4DQCh. 10 - LO.2 David, a sole proprietor of a bookstore, pays...Ch. 10 - LO.2 Jayden, a calendar year taxpayer, paid 16,000...Ch. 10 - Prob. 7DQCh. 10 - Prob. 8DQCh. 10 - Prob. 9DQCh. 10 - Prob. 10DQ
Ch. 10 - LO.5 Thomas purchased a personal residence from...Ch. 10 - Prob. 12DQCh. 10 - Prob. 13DQCh. 10 - LO.6, 8 William, a high school teacher, earns...Ch. 10 - LO.2 Barbara incurred the following expenses...Ch. 10 - Prob. 16CECh. 10 - Prob. 17CECh. 10 - Prob. 18CECh. 10 - Prob. 19CECh. 10 - Prob. 20CECh. 10 - Prob. 21CECh. 10 - Prob. 22PCh. 10 - Prob. 23PCh. 10 - LO.2 Paul suffers from emphysema and severe...Ch. 10 - LO.2 For calendar year 2019, Jean was a...Ch. 10 - LO.2 During 2019, Susan incurred and paid the...Ch. 10 - In May, Rebeccas daughter, Isabella, sustained a...Ch. 10 - Prob. 28PCh. 10 - Prob. 29PCh. 10 - Prob. 30PCh. 10 - Prob. 31PCh. 10 - Prob. 32PCh. 10 - Prob. 33PCh. 10 - Prob. 34PCh. 10 - On December 27, 2019, Roberta purchased four...Ch. 10 - Prob. 36PCh. 10 - Prob. 37PCh. 10 - Prob. 38PCh. 10 - LO.2, 3, 4, 5, 6, 7 Linda, who files as a single...Ch. 10 - LO.2, 3, 4, 5, 6, 7 For calendar year 2019, Stuart...Ch. 10 - Prob. 41CPCh. 10 - Marcia, a shareholder in a corporation with stores...Ch. 10 - Prob. 4RPCh. 10 - Prob. 1CPACh. 10 - Prob. 2CPACh. 10 - Prob. 3CPACh. 10 - Kurstie received a 800 state income tax refund...Ch. 10 - Which of the following would preclude a taxpayer...Ch. 10 - Prob. 6CPA
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Similar questions
- Refer to the previous problem 8. If Stan's parents elected to report Stan's income on his parents' return, what would the tax on Stan's income be?arrow_forwardWhich of the following tax credits can not be transferred to a spouse? The age credits The disability credit The EI and CPP benefits The pension income credits The claw back of OAS payments will not alter the individual’s net income for tax purposes (True/False)- _________ There is no limit on the amount of the tuition credit that can be transferred to a spouse (True/False)- ________ Adam, who is single supports his 80 years old blind mother who has no income and lives in a nursing home. Which of the following federal tax credit can be claimed for his mother? Disability tax credit only disability tax credit and Canada caregiver tax credit only disability tax credit and eligible tax credit only Canada caregiver credit only. Joe is self-employed. He might be eligible for all of the following Federal tax credits, except: CPP tax credit EI tax Credit Canada employment Tax Credit Canada workers benefit tax credit. Elsa is 73 years old. Her 2021 net income for tax…arrow_forwardChristian wants to transfer as much as possible to his 4 adult married children (including spouses) and 13 minor grandchildren without using any unified transfer tax credit. a. What amount should Christian transfer to accomplish his tax goal without using any unified transfer tax credit? b. What if Christian's spouse, Mia, joins in the gifts? They can gift $__--- without using any unified transfer tax credit. c. Express your computations for parts (a) and (b) as a Microsoft Excel formula.arrow_forward
- John is not sure if he needs to complete a tax return. Assist him by critically assessing any 5circumstances that may qualify him.arrow_forwardWhich of the following statements is false regarding the earned income credit (EIC)? Multiple Choice If certain requirements are met, a taxpayer may receive advance payments of EIC. Maximum amount of the credit depends on the earned income and number of children. A taxpayer without children cannot claim the credit. The credit is refundable.arrow_forward17. Which of the following expenses, if any, is/are deductible? a.Contribution to an IRA. b.Job-hunting expenses of a fishing guide to become an insurance salesman. c.Costs involved in maintaining an office in the home by a self-employed insurance adjuster. Taxpayer's wife also uses the office as a meeting place for her bridge club. d.Cost of moving to first job location. Taxpayer just graduated from college.arrow_forward
- For tax purposes, "gross income" is all the money “taxable income" rather than gross income. The difference between the two is the result of many exemptions and deductions. To see how they work, suppose you made $60,000 last year in wages, earned $10,000 from investments, and received a gift of $5,000 from your grandmother. Also assume that you are a single parent with one small child living with you. person receives in a given year from any source. But income taxes are levied on Instructions: Enter your answers as a whole number. a. What is your gross income? $ b. Gifts of up to $15,000 per year from any person are not counted as taxable income. Also, the personal exemption allows you to reduce your taxable income by $4,050 for each member of your household. Given these exemptions, what is your taxable income? 2$ c. Next, assume you paid $700 in interest on your student loans last year, put $2,000 into a health savings account (HSA), and deposited $4,000 into an individual…arrow_forwardIndividual Retirement Accounts (LO 5.3) Phil and Linda are 25-year-old newlyweds and file a joint tax return. Linda is covered by a retirement plan at work, but Phil is not. If an amount is zero, enter "0". a. Assuming Phil's wages were $27,000 and Linda's wages were $18,500 for 2018 and they had no other income, what is the maximum amount of their deductible contributions to a traditional IRA for 2018? Phil $ Linda $ b. Assuming Phil's wages were $53,000 and Linda's wages were $70,000 for 2018 and they had no other income, what is the maximum amount of their deductible contributions to a traditional IRA for 2018? Phil $ Linda $arrow_forwardc. Compute Charlotte's child and dependent tax credit.Charlotte's child tax credit is $8,000, of which $ ______ may be refundable and her dependent tax credit is $1,000 of which $0 may be refundable. I understand where the $8,000 comes from and the where the $1000 comes from, However the one blank, nothing seems to work, )1000, 500, 2000, etc.)arrow_forward
- Answer the following a. If Kathleen receives a $17,000 distribution from her traditional 401(k) account, how much will she be able to keep after paying taxes and penalties, if any, on the distribution? b. If Kathleen receives a $17,000 distribution from her Roth 401(k) account, how much will she be able to keep after paying taxes and penalties, if any, on the distribution? c. If Kathleen retires from MH and then receives a $17,000 distribution from her traditional 401(k), how much will she be able to keep after paying taxes and penalties, if any, on the distribution?arrow_forwardLO.2 Does the taxpayer recognize gross income in the following situations? a. Ava is a filing clerk at a large insurance company. She is permitted to leave the premises for lunch, but she usually eats in the companys cafeteria because it is quick and she is on a tight schedule. On average, she pays 2 for a lunch that would cost 12 at a restaurant and it cost her employer 10 to prepare. However, if the prices in the cafeteria were not so low and the food was not so delicious, she would probably bring her lunch at a cost of 3 per day. b. Scott is an executive for an international corporation located in New York City. Often he works late, taking telephone calls from the companys European branch. Scott often stays in a company-owned condominium when he has a late-night work session. The condominium is across the street from the company office and has the technology needed to communicate with employees and customers throughout the world. c. Ira recently moved to take a job. For the first month on the new job, Ira was searching for a home to purchase or rent. During this time, his employer permitted Ira to live in an apartment the company maintains for customers during the buying season. The month that Ira occupied the apartment was not during the buying season, and the apartment would not otherwise have been occupied.arrow_forward
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