Question

Using the married filing jointly status and their income and expense​ statement, calculate the 2014 tax liability for Shameka and Curtis Williams. First use the standard​ deduction, and then use the following itemized​ deductions:

Income			Expenses
Earned income	​$55,000.00		Home mortgage interest	​$8,200.00
Interest income	1,700.00		Real estate and state income taxes	3,900.00
			Miscellaneous deductions	500.00

Explain to the Williams which method they should use and why.

Shameka and​ Curtis' total gross income for the 2014 tax year is ​$_____. ​(Round to the nearest​ cent.)

Answer 1

	Earned Income(A)	55000
	Interest Income(B)	1700
	Income(C )+(A)+(B)	56700
	Less: Personal Exemption($3950*2)=(D)	7900
	Gross Income( E )=(C )-(D)	48800
*	Less: Greater of Itemized deduction or Standard Deduction=(F)	12600
	Taxable Income(G )=(E )-(F)	36200
**	Tax	4523
	Standard Deduction for 2014 for married filing Joint Return	12400
	Total of Itemized Deduction
	Home Mortgage Interest	8200
	Real estate and state income taxes	3900
	Miscellaneoud Deduction	500
	Total of Itemized Deduction	12600
**	Tax Caluclation($1815+($36200-$18150)*15%	4522.5
	Shameka and​ used itemised deduction . gross income=$36200 and Tax=$4523