Question

Matt and Becky are both 66 years of age. Matt still works and earned $38,000 last year. Matt and Becky also have the following income: Interest income $2,000 Social security benefits 9,000 Determine their taxable income and tax liability.

Answer 1

Solution:

Wages =$38,000

Intrigue pay =$2,000

half government disability benefits =$4,500

Temporary salary = $44,500($38,000+$2,000+$4,500)

Since temporary salary surpasses the edge furthest reaches of $44000, Matt and Beckyare subject to a more noteworthy part of standardized savings benefits being incorporated into AGI.

A. $9,000 x 85 %

= $7,650

B. [($44,500 - $44,000)] x 85% + $4,500

= $4,925

Matt and Becky must incorporate $4,925 of their government managed savings benefits in AGI.

Their Taxable income is figured as pursues:

AGI ($38,000 + $2,000 + $4,925)

= $44,925

Less: Standard derivation ($12,200 +$2,400)

= - 14,600

Individual exception

= - 7,800

Taxable income =$22,525

answered by: anonymous