A. Determine Jeremy’s tax refund or taxes due. B. Assume that in addition to the

Question

A. Determine Jeremy’s tax refund or taxes due.
B. Assume that in addition to the original facts, Jeremy has a long-term capital gain of $9050. What is Jeremy‘s tax return or tax due including the tax on the capital gain?
C. Assume the original fax except that Jeremy had only $7000 and itemized deductions. What is Jeremy’s tax refund or tax due?
a. Determine Jeremy's tax refund or taxes due. Description Amount (1) Gross income (2) | For AGI deductions (3) Adjusted gross income its Hint(4) Standard deduction (5) Itemized deductions Print / References(7) Taxable income (8) Income tax iability (9) Child tax credit (10) Tax withholding 1 2 3 of 13

Explanation / Answer

Part A

(1) Gross income(101100 salary + 7100 interest income)................................................... .. 108200

(2) For AGI deductions........................………0

(3) Adjusted gross income........................ $108200

(4) Standard deduction.................................. 18000

(5) Itemized deductions........…………………… .. 27700

(6) Greater of standard deduction or itemized deductions.....……………............................................................ 27700

(7) Personal and dependency exemptions (4150*3).... 12450

(8) Taxable income................................................ $68050

Income tax liability............................... ...................$10519

(68050 – 51800) × 22% + $5944 (using 2018 tax rate schedule for head of household)

Part B

(1) Gross income (101100+7100+9050).................... 117250

(2) For AGI deductions................................................... 0

(3) Adjusted gross income................................... $117250

(4) Standard deduction(head of household)........ 18000

(5) Itemized deductions...................... ................27700

(6) Greater of standard deductions or itemized deductions....................... ......................................27700

(7) Personal and dependency exemptions............ 12450

(8) Taxable income................................................. $77100

Income tax liability.................................................. $11876.50

($68050– 51,800) × 22% + 5944 + 9050 × 15% (using tax rate schedule for head of household)

Part C

(1) Gross income (101100+7100)....................108200

(2) For AGI deductions......................................... 0

(3) Adjusted gross income...................... .... $108200

(4) Standard deduction(Head of household)....... 18000

(5) Itemized deductions...............................................7,000

(6) Greater of standard deduction or itemized deductions.................................................................... 18000

(7) Personal and dependency exemptions................. 12450

(8) Taxable income...................................................... $77750

Income tax liability........................... ................. ....... .$11653

(77750 – 51800) × 22% + 5944 (using tax rate 2018 schedule for head of household)

Tax rates and other rates are used for 2018

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