Question

**ANSWER THE FOLLOWING FOR EACH QUESTIONS:**

**A) Determine the AGI this year for the
taxpayer(s).**

**B) Determine the amount of itemized deductions the
taxpayer(s) has (have) available this year.**

**C) Using the 2018 standard deduction amounts (assuming
no additional amounts for age or blindness) from Appendix D in of
your book, state whether the taxpayer(s) itemize or take the
standard deduction. I am not asking for you to state the amount of
either the standard deduction or the itemized deductions
chosen.**

**D) Use the individual tax formula and a flat 20% tax
rate on all types of taxable income to determine the amount of
taxes due or refund amount. Remember to clearly marking the answer
as either the amount of tax due or a refund due (e.g. refunds are
negative amounts as represented with parentheses or a negative
sign, alternatively you can just write “refund” next to it). Assume
AMT does not apply, and there are no tax credits
available.**

4. Rebecca and Thomas are married and file jointly for the 2018 tax year. They are both advertising consultants for the same company. They earned $85,000 in salaries in total and the company forgave a $20,000 loan they made to the couple earlier in the tax year. They were solvent at the time the loan was forgiven. Their firms withheld $20,000 of tax from their salaries this year in total. In addition to the above, the following occurred during the year:

• They paid $15,000 in mortgage interest and $3,000 in real estate taxes for their primary residence.

• Rebecca paid $6,000 on college tuition this year.

• They sold their SUV for $1,500 less than its adjusted tax basis. They had owned it for 7 years. They are not high income taxpayers.

Answer #1

Calculation Of AGI = $85,000 (Salary) + $20,000 (Cancellation of Debt) = $105,000. Thus, Total AGI = $105,000.

we are considering standard deduction of $24,000, since the itemized deductions are less than standard deduction.

Itemized deduction = $15,000 (mortgage interest) + $3,000 (real estate taxes) = $18,000.

Taxable Income = AGI - Standard Deduction = 105,000 - 24,000 = 81,000

Tax @ 20% = 81,000*20% = $16,200

Taxes withheld = $20,000

Refund = $16,200 - $20,000 = $3,800

Chen, a single taxpayer, had the following income and deductions
during 2018:
Salary
$55,000
Interest on bank
account
750
Tax-exempt
interest
500
Deduction for
AGI
5,500
Itemized
deductions
15,000
Taxes
withheld
5,500
Calculate Chen's tax liability due or refund.
$1,010.50 tax liability.
$1,010.50 refund.
$705.50 tax liability.
D) $705.50 refund.

Louis files as a single taxpayer. In April of this year he
received a $1,200 refund of state income taxes that he paid last
year. How much of the refund, if any, must Louis include in gross
income under the following independent scenarios? Assume the
standard deduction last year was $12,000.
a. Last year Louis claimed itemized deductions of $12,095.
Louis’s itemized deductions included state income taxes paid of
$2,075 and no other state or local taxes.
b. Last year...

Louis files as a single taxpayer. In April of this year he
received a $900 refund of state income taxes that he paid last
year. How much of the refund, if any, must Louis include in gross
income under the following independent scenarios? Assume the
standard deduction last year was $12,000. (Leave no answer blank.
Enter zero if applicable.)
a. Last year Louis claimed itemized deductions of $12,250.
Louis’s itemized deductions included state income taxes paid of
$1,750 and no...

1/ Linda, who files as a single taxpayer, had AGI of $280,000
for 2018. She incurred the following expenses and
losses during the year:
Medical expenses (before the 7.5%-of-AGI limitation)
$33,000
State and local income taxes
4,800
State sales tax
1,300
Real estate taxes
6,000
Home mortgage interest
5,000
Automobile loan interest
750
Credit card interest
1,000
Charitable contributions
7,000
Casualty loss (before 10% limitation but after $100 floor; not
in a Federally declared disaster area)
34,000
Unreimbursed employee business...

1. Chen, a single taxpayer, had the following income and
deductions during 2018:
Salary
$55,000
Interest on bank
account
750
Tax-exempt
interest
500
Deduction for
AGI
5,500
Itemized
deductions
15,000
Taxes
withheld
5,500
Calculate Chen's tax liability due or refund.
2.
Artimisa's employer pays $8,000 in tuition this year for
Artimisa to attend a graduate business program. How much of the
employer-provided tuition is taxable to Artimisa?
A) $0
B) $2,750
C) $5,250
D) $8,000

1) The Inouyes filed jointly in 2018. Their AGI is $78,000. They
reported $2,000 of qualified business income and $22,000 of
itemized deductions. They have two children, one of whom qualifies
as their dependent as a qualifying child. The 2018 standard
deduction amount for MFJ taxpayers is $24,000. What is the total
amount of from AGI deductions they are allowed to claim on their
2018 tax return? Learning Objective: 04-01 Describe the formula for
calculating an individual taxpayer's taxes payable...

Linda, who files as a single taxpayer, had AGI of $280,000 for
2018. She incurred the following expenses and losses during the
year:
Medical expenses (before the 7.5%-of-AGI limitation)
$33,000
State and local income taxes
4,800
State sales tax
1,300
Real estate taxes
6,000
Home mortgage interest
5,000
Automobile loan interest
750
Credit card interest
1,000
Charitable contributions
7,000
Casualty loss (before 10% limitation but after $100 floor; not
in a Federally declared disaster area)
34,000
Unreimbursed employee business expenses...

Petunia's (filing status: single and she is her only dependent)
tax calculations are as follows assuming a 2018 tax year). 2018
standard deduction amount is $6,500 and the exemption amount for
2018 is $4150. Petunia is single and will claim herself as an
exemption. She has a house mortgage interest amount of $4,300,
property taxes of $3,900, and made $4,950 in charitable
contributions during the year. All these are itemized deductions.
Calculate her (progressive) income tax liability:
Wages, salaries,...

Linda, who files as a single taxpayer, had AGI of $280,000 for
2018. She incurred the following expenses and losses during the
year:
Medical expenses (before the 7.5%-of-AGI limitation)
$33,000
State and local income taxes
4,800
State sales tax
1,300
Real estate taxes
6,000
Home mortgage interest
5,000
Automobile loan interest
750
Credit card interest
1,000
Charitable contributions
7,000
Casualty loss (before 10% limitation but after $100 floor; not
in a Federally declared disaster area)
34,000
Unreimbursed employee business expenses...

Pedro, who is a single taxpayer, had AGI of $361,200 for 2017.
He incurred the following expenses during the year: Medical
expenses before 10%-of-AGI limitation $21,980 State and local
income taxes $10,836 Real estate taxes $2,167 Home mortgage
interest $18,060 Charitable contributions $4,334 Deductible
investment interest expense $1,625
Compute the amount of Pedro's itemized deductions after any
applicable reductions and/or limitations. Round your computations
to the nearest dollar and use rounded amounts in subsequent
calculations. $

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