During the current year, Angela sustains serious injuries from a snow skiing acc

Question

During the current year, Angela sustains serious injuries from a snow skiing accident. She incurs the following expenses:

Item Amount
Doctor bills $11,700
Hospital bills 9,400
Legal fees in suit against ski resort 3,000

Angela is single and has no dependents. During the current year, her salary is $58,000. She pays $600 in medical and dental insurance premiums, $2,750 in mortgage interest on her home, and $1,200 in interest on her car. Her health insurance provider reimburses her for $10,000 of the medical expenses. What is her current year taxable income?

What is her current year taxable income? Show all Calculations

Explanation / Answer

Income Statement Revenues Salary $58,000 Expenses: Medical and dental insurance $600 Intereston Mortgage loan 2,750 Interest on car 1,200 Doctor bills $11,700 Hospital bills 9,400 21,100 Less: Medical reimburses 10,000 11,100 Legal fees 3,000 Total expenses 18,650 Taxable Income $39,350

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