Question

Return to Jeremy earned $100,000 in salary and $6,000 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 $23,000 in itemized deductions. (Use the tax rate schedules.) b. Assume that in addition to the original facts, Jeremy has a long-term capital gain of $4,000. What is Jeremy's tax refund or tax due including the tax on the capital gain? (Round your intermediate calculations and final answer to the nearest whole dollar amount. Answer is complete but not entirely correct. (1) (2) (3) 4) (5) (6) (7) (8) (9) (10) Description Gross income For AGI deductions Adjusted gross income Standard deduction Itemized deductions Greater of standard deduction or itemized deductions Taxable income Income tax liability Child tax credit Tax withholding Tax due Amount $ 110,000 0 $ 110,000 18,350 23,000 23,000 $ 87,000 $ 13,634 % 2,000 11,000 $ 634 %

Answer 1

Gross Income	$ 110,000.00	$100,000 salary + $6,000 interest income + 4,000 long-term capital gains
For AGI Deductions	$                -
Adjusted Gross Income	$ 110,000.00
Standard Deduction	$   18,350.00
Itemized Deductions	$   23,000.00
Greater of standard deductions or itemized deductions	$   23,000.00
Taxable Income	$   87,000.00
Income Tax Liability	$   13,298.00	[6065 + (87000 - 4000 (LTCG)- 52850) x 22%] + 4,000 × 15% (See tax rate schedule for head of household. Also note that the LTCG is taxed at a  rate of 15%.)
Child Tax Credit	$     2,000.00
Tax Withholding	$   11,000.00
Tax Due	$        298.00