3) Jane and Ed Rochester are m
3) Jane and Ed Rochester are married with a 2-year-old child,who lives with them and whom they support financially. In 2019, Edand Jane realized the following items of income and expense: AmountItems:
$ 35,000 Ed’s Salary, $70,000 Jane’s Salary , $400 Municipalbond interest income, $1,000 Qualified business income, $8,000Alimony paid (divorce in 2018) $10,000 Real property tax (from AGIdeduction) Their employers withheld $5,800 in federal income taxesfrom their paychecks.
A) What is their AGI?
B)What is their Taxable Income?
Answer:
| A.) | AGI | ||
| Amount in$ | |||
| Ed’s Salary | 35,000 | ||
| Add: Jane’s Salary | 70,000 | ||
| Add: Municipal bond interestincome | 400 | ||
| Add: Qualified businessincome | 1,000 | ||
| GrossIncome | 106,400 | ||
| Less: Alimony paid (divorce in 2018) | 8,000 | ||
| Less: Real property tax | 10,000 | ||
| AGI | 88,400 | ||
| B.) | Taxable Income | ||
| Amount in$ | |||
| AGI | 88,400 | ||
| Less: Standard Deduction | 24,400 | ||
| TaxableIncome | 64,000 | ||
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