Jane and Robert Brown are married and have eight children, all of whom are eligi

Question

Jane and Robert Brown are married and have eight children, all of whom are eligible to be claimed as the couple’s dependents. Robert earns $94,000 working as an accountant, and Jane earns $35,000 as a teaching aide.

Given their large family, the Browns live in a frugal manner. The family maintains a large garden and some fruit trees from which they get most of their produce, and the children take family and consumer science classes so that they can help make their clothing. The couple has no other income besides their salaries (all of their investment income is earned from retirement savings), and their itemized deductions are less than the standard deduction. The Browns report no other AMT adjustments or preferences.

a. What is the couple’s 2015 regular tax liability?
$

b. What is the couple’s 2015 AMT?

Explanation / Answer

the total income of the family= 94,000+35,000= 129,000

this family covers under the tax payment - married individual filing joint returns-

upto 18,450- 10%= 1845

18450-74900- 15%= 8467.5

74900-151,200-25%= 13525

the total tax liability= 1845+8467.5+13525= $23,837.5

B. their AMT= 129,000- 23,837= $105,163

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