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1. Roger Burrows, age 19, is a full-time student at Marshall College and a candi

ID: 2415560 • Letter: 1

Question

1. Roger Burrows, age 19, is a full-time student at Marshall College and a candidate for a bachelor’s degree. During 2015, he received the following payments:

Private scholarship for tuition   $9,600

Loan from financial aid office $6,500

Cash support from parents     $10,000

Cash dividends on qualified investments $400

Cash prize award in contest $2,800

What is his adjusted gross income?

2. Stan and Anne were divorced in January 2015. The provisions of the divorce decree and Anne’s obligations follow:

Transfer title in their resort condo to Stan. At the time of the transfer, the condo had a basis to Anne of $75,000, a fair market value of $195,000; it was subject to a mortgage of $58,000

Anne is to make the mortgage payments for 17 years regardless of how long Stan lives. Anne paid $9,130 in 2015 on the mortgage.

Anne is to pay Stan $1,200 per month, beginning in Feb, for 10 years or until Stan dies. Of this amount, $520 is designated as child support. Anne made all the payments required in 2015.

What would the effect of these payments be on the AGI of Anne and Stan?

3. If a married couple who files jointly has taxable income of $132,435 in 2015 with no capital gains nor qualified dividends nor tax credits, what is their income tax liability for 2015.

Explanation / Answer

Adjusted total income

Cash dividend income on investment=400

Cash prize award =2800

Total adjusted income =3200

Remaining reciets are not taxable