Question

Jane and Ed Rochester are married with a 2-year-old child, who lives with them and whom they support financially. In 2019, Ed and Jane realized the following items of income and expense:

Ed's Salary 35,000

Jane's Salary 70,000

Municipal bond interest income: 400

Qualified business income 1,000

Alimony paid (for AGI deduction) (7000)

Real property tax (From AGI deduction) (10,000)

Charitable contributions (from AGI) (15,000)

They also qualified for a $2,000 child tax credit. Their employers withheld $5,800 in federal income taxes from their paychecks (in the aggregate). Finally, the 2019 standard deduction amount for MFJ taxpayers is $24,400.

What is the couple's gross income?

What is the couple's adjusted gross income?

What is the couple's taxable income?

What are the couple's taxes due or tax refund? (Use the tax rate schedules, not tax tables.)

Answer 1

Solution Given data, , Ed's Salary & 35000 Jane's salary - 70000 Municipal bond interest income - 400 Qualified business income = lovo Aliniony paid for Agi deduction) = 67000) Real poupeaty tan (from AG Å deducten) = (10000) Charitable con toibution (from AGI) = (15000) Couple's total gooss income = 35000 +10000 = 105000 Adjusted gross income a 105000 + 400+3000 z 12400 Taxable income = 112400-400 – 24000-7000 ... = $ 80600 Tax - 5800 +5637 13793 Less- child credit 2000 Taxe 1793