Steve and Sue are married with three dependent children. Their 2015 joint income

Question

Steve and Sue are married with three dependent children. Their 2015 joint income tax return shows $389,000 of AGI and $60,000 of itemized deductions made up of $30,000 of state income taxes and $30,000 of charitable contributions. Calculate the following amounts: In your calculations, round percentages to the nearest whole number. Round your answers to the nearest dollar. a. Allowable itemized or standard deduction amount $    b. Allowable exemptions deduction amount $                                        c. Taxable income $

Explanation / Answer

A)Allowable Itemized deduction or standard deduction = $ 60000

since itemized deduction is higher than standard deduction of $ 11400 ,.

B)Allowable exemption = 3650 * 5 person =$ 18250

C)Taxable income = 389000 - 60000 -18250 = $ 310,750

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