1. Ron, age 19, is a full-time graduate student at Post University. During the y

Question

1. Ron, age 19, is a full-time graduate student at Post University. During the year he received the following payments: Scholarships for ten months (tuition and books) $6,000 Loan from college financial aid office $3,000 Cash support from parents $2,500 Cash award for being an outstanding RA $1,500 Ron served as resident advisor in a dormitory and, therefore, the university waived the $2,500 charge for the room he occupied. What is Ron's adjusted gross income for the year? a. $1,500. b. $4,000. c. $7,500. d. None of the above.

2. Calculate the 2015 gross income filing requirements for Marcus (19) who is unmarried and not a dependent.

3. Calculate the 2015 gross income filing requirements for Kristen (age 56) who is unmarried and lives with her dependent son (age 16).

4. Walker is single and has 2015 taxable income of $170,000. Determine Walter's 2015 federal income tax liability.

5. Calculate the 2015 gross income filing requirement for Joe (age 70) and Savanah (aged 65) who file jointly.

Explanation / Answer

Part 1)

1,500 (which is Option A)

__________

Explanation:

Scholarships for ten months (tuition and books) of $6,000 will be excluded from gross income. Loan from college finanical aid is not an income. Money received from parents is not an income. Room provided for $2,500 is for the convenienc of the employer and therefore, will not be treated as a part of gross income. The only amount include in gross income would be $1,500 received as cash award for being an outstanding.

_______________

Part 2)

As per the rule of IRS, the gross income filing requirements for an individual of less than 65 years and unmarried is $10,300. Therefore, Marcus must have a gross income of atleast $10,300 in order to file an income tax return for the year 2015.

_______________

Part 3)

As per the rule of IRS, the gross income filing requirements for an individual (unmarried/widow) of less than 65 years living with a dependant child is $16,600. Therefore, Kristen must have a gross income of atleast $16,600 in order to file an income tax return for the year 2015.

_______________

Part 4)

The federal income tax liability for Walker is calculated as below:

Walker's Federal Income Tax Liability = 18,481.25 + 28%*(Excess of Taxable Income over 90,750) [source IRS tax rates for 2015]

Using the information provided in the question, we get,

Walker's Federal Income Tax Liability = 18,481.25 + 28%*(170,000 - 90,750) = $40,671.25

_______________

Part 5)

As per the rule of IRS, the gross income filing requirements for a couple of more than 65 years filing jointly is $23,100. Therefore, Joe and Savanah must have a gross income of atleast $23,100 in order to file an income tax return for the year 2015.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.