Question

Taxable Income and Tax Liability Calculations - Single (LO. 6)

Total income $118,000 Excludable income 2,000 Deductions for adjusted gross income 2,500 Deductions from adjusted gross income 8,000

(Hint: The standard deduction for filing single is $12,200.)

Do not round intermediate computations. Round the final tax liability to the nearest cent.

Based on the above information, for a single individual, adjusted gross income (AGI) is $??????, taxable income is $ ??????? and the tax liability is $???????

Answer 1

Particulars	Amount
Total Income	$       1,18,000
Less : Excludable Income	$             2,000
Less : Deductions for AGI	$             2,500
Adjusted Gross Income	$       1,13,500
Deeuction from AGI	$           12,000
(Greater of Standard Deduction $12,000 & Itemized deductions $8,000)
Taxable Income	$       1,01,500

Tax liability

Tax liability slab used = $18481.25 plus 28% of the amount over $18481.25 + 3010 (101500- 90750)

21,491