Jack and Jill file a joint return for 2019 reflecting salaries of $110,000. They incur the following expenditures and income:
Medical expenses of $9,000, Medical Insurance premiums $7,000, Drug Rehab Program $1,000, Swimming lessons $300
Interest on Margin account $6,000, Mortgage Home Interest $10,000, Credit Card Interest $800,
State Income Tax $7,000, Property taxes, $9,000, Sales Tax $1,000.
Charitable contribution $6,000, Political contribution $100, Gambling losses $500, Casualty loss $3,000
Qualified Business income $20,000, Net Investment income $4,000
A. What is their AGI?
B. What is their Itemized Deductions?
C. What is their taxable Income?
A.
Salary | 110000 |
Qualified Business Income | 20000 |
Net Investment Income | 4000 |
AGI | 134000 |
B.
Particulars | Amount | Itemized Deduction |
Medical Expenses | 9000 | |
Medical Insurance Premium | 7000 | |
Drug Rehab Program. | 1000 | |
(-)7.5% of AGI (134000*7.5%) | -10050 | 6950 |
Interest on Margin Account | 6000 | 6000 |
Interest on Home Mortgage | 10000 | 10000 |
Property Taxes on Home | 9000 | |
State Income Tax | 7000 | 7000 |
Sales Tax | 1000 | 1000 |
Charitable Contribution: (limited upto 50% of AGI) | 6000 | 6000 |
Casualty Loss | 3000 | |
(-) Less:- | -100 | |
(-) Less:- (10% * 134000) | 13400 | 0 |
Total | 36950 |
C.
AGI | 134000 |
Itemized Deduction | -36950 |
Standard Deduction | -24400 |
Greater of standard or itemized deduction | -36950 |
Taxable Income | 97050 |
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