Question

could you please answer quiestion #1-2

Problem #1 Kobe is a single dad with two dependent children, Lizzie, age 7 and Leslie, age 3. He has AGI of $51.000 and paid $6.300 to a qualified day care center. What amount of credit can Kobe receive for the child and dependent care credit? Problem #2 DJ and Nicolette paid $1,600 in qualifying expenses for their daughter Nicole to attend the University of Nevada Nicole is a sophomore. DJ and Nicolette's AGI is $175,000. What is their maximum allowable American opportunity tax credit after the credit phase-out based on AGI is taken into account? Problem #3 Jake is a single taxpayer. He has twin sons, ages 7. If his AGI is $216,950, what amount of child tax credit can he claim? Problem #4 Chris and Sarah are married with three qualifying children. Their AGI is $25,000. How much is their EIC (use the EIC tables)?

Answer 1

Question No.- (1)

Answer -

Step- ( 1 ) - Facts of the case given -

Kobe is a single dad with two dependent children, Lizzie, age 7 and Leslie, age 3.

He has AGI of $51000 and paid $6300 to a qualified day care center.

.

Step- ( 2 ) - Relevant Notes on Child and Dependent Care Credit -

Note-(1) -  Child and Dependent Care Credit qualifications -

• Dependent must be under age 13.
• Dependent age 13 or over, if physically or mentally incapable of caring for themselves.

Note-(2) - Child and Dependent Care Credit = Eligible care costs * Applicable percentage.

Note-(3) - Dependent Care Credit is limited to a range of 20% to 35%.

Note-(4) - The 20%-35% is taken from up to $3000 of expenses paid for one Qualifying Person, or from up to $6000 of expenses paid for two or more Qualifying Persons.

Note-(5) - If Adjusted gross income below $15000, it will qualify for the full 35%. The percentage falls by 1% for every additional $2000 of income until it reaches 20% (for an Adjusted gross income of $43000 or more).

.

Step- ( 3 ) - Calculation of Child and Dependent Care Credit -

As, Kobe has an Adjusted gross income of $51000, so he is eligible for a credit rate of 20%.

Kobe is limited to $6000 in qualified child care expenses (As per U.S. Internal Revenue Service)

Therefore, The amount of Kobe's Credit for Child and Dependent Care Expenses is ($6000 * 20%) = $1200 for the year.