Question

Jeremy earned $102,500 in salary and $8,500 in interest income during the year. Jeremy's employer withheld $11,000 of federal income taxes from Jeremy's paychecks during the year. Jeremy has one qualifying dependent child who lives with him. Jeremy qualifies to file as head of household and has $34,700 in itemized deductions. (Use the tax rate schedules.) a. Determine Jeremy's tax refund or taxes due. Description Amount $ 111,000 (1) Gross income (2) For AGI deductions (3) Adjusted gross income (4) Standard deduction $ 111,000 Itemized deductions 34,700 $ 111,000 (6) Greater of standard deduction or itemized deductions (7) Taxable income (8) Income tax liability (9) Child tax credit (10) Tax withholding

Answer 1

Part A

	Description	Amount
1	Gross income (102500+8500)	111000
2	For AGI deductions	0
3	Adjusted gross income	111000
4	Standard deduction	18350
5	Itemized deductions	34700
6	Greater of standard deductions or itemized deductions	34700
7	Taxable income	76300
8	Income tax liability	$11224(6065+(22%*(76300-52850)))
9	Child tax credit	2000
10	Tax withholding	11000
	Taxes refund	$(1776)

Part B

	Description	Amount
1	Gross income (102500+8500+16050)	127050
2	For AGI deductions	0
3	Adjusted gross income	127050
4	Standard deduction	18350
5	Itemized deductions	34700
6	Greater of standard deductions or itemized deductions	34700
7	Taxable income	92350
8	Income tax liability	$13632 (6065+(22%*(76300-52850)))+(16050*15%)
9	Child tax credit	2000
10	Tax withholding	11000
	Taxes refund	$632

Part C

	Description	Amount
1	Gross income (102500+8500)	111000
2	For AGI deductions	0
3	Adjusted gross income	111000
4	Standard deduction	18350
5	Itemized deductions	7000
6	Greater of standard deductions or itemized deductions	18350
7	Taxable income	92650
8	Income tax liability	$14990 (12962+(24%*(92650-84200)))
9	Child tax credit	2000
10	Tax withholding	11000
	Taxes refund	$1990