61. Comprehensive Problem. Richard and Jennifer were married in 2009. They have

Question

61. Comprehensive Problem. Richard and Jennifer were married in 2009. They have a five-year-old child and a son born November 15, 2018. Richard's 67-year-old father lived in a nursing home until his death on May 23, 2018. Richard and Jennifer provided all of his support until his death. Richard earned $43,000 in salary during the year. They also received $2,100 in interest from the credit union. They incurred $17,000 in itemized deductions during the year. Compute Richard and Jennifer's income tax for 2018 using the Tax Rate Schedules

Explanation / Answer

Tax computation is as follows:-

Income from salary USD 43000 + Interest income received USD 2100 - Itemized deduction USD 17000 equals to USD 28100. Therefore tax payable as per recent tax rate schedule for married individuals will be 12 percent of USD 28100-USD 19050 i.e. USD 1086. Hope the same is clarified.

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