Question

Bob and Allie Katz are a married couple with three children. Their wages for 2018 totaled $125,400 with an additional $200 in interest income. They have calculated their itemized deductions to be $33,700 and also realized a short-term capital gain of $2,600. They sold stock for $13,000 in 2018 which had been purchased in 2016 for $10,000. For the year, Bob and Allie have paid $24,600 in federal taxes. They are also eligible for a tax credit of $500. Combined, they contributed $10,000 into their Roth IRA’s. What is their taxable income?

Answer 1

Particulars	Amount
Gross income	$             131,200
Less: adjustments	$                        -
AGI	$             131,200
Less: deductions	$                33,700
Subtotal	$                97,500

Gross income = =125400 salary +200 interest +2600 capital gain +13000 sale value -10000 cost = 131,200