Question

Preston and Anna are engaged and plan to get married. Preston is a full-time student and earns $7,600 from a part-time job. With this income, student loans, savings, and nontaxable scholarships, he is self-supporting. For the year, Anna is employed and reports $75,200 in wages.

Click here to access the standard deduction table to use. Click here to access the Tax Rate Schedules. If an amount is zero, enter, "0". Do not round your intermediate computations. Round your final answer to nearest whole dollar.

a. Compute the following:

Preston Filing Single Anna Filing Single Gross income and AGI $ $ Standard deduction Taxable income $ $ Income tax $ $

b. Assume that Preston and Anna get married in 2018 and file a joint return. What is their taxable income and income tax? Round your final answer to nearest whole dollar.

Married Filing Jointly Gross income $ Standard deduction Taxable income $ Income tax $

c. How much Federal income tax can Preston and Anna save if they get married in 2018 and file a joint return?
$

Answer 1

All the following calculations based on 2018 tax rates Requirement a: Preston filing Anna filing single single Gross income and AGI $ 7,600 $ 75,200 Standard deduction $ (12,000) $ (12,000) Taxable income 63,200 Income tax 0$ 9,844 Anna tax calculation : 9,525 x 10% [38,700 - 9,525] x 12% [63,200 - 38,700 ] x 22% Tota tax to be paid by Anna 952.5 3501 5390 9843.5

requirement b: married filing jointly married filing jointly Preston Anna $ 7,600 $ 75,200 Total $ Gross income and AGI Standard deduction Taxable income Income tax 82,800 (24,000) 58,800 6,675 $ $ Tax calculation - married filing jointly 19,050 x 10% [ 58,800 - 19,050 ] x 12% 1905 4770 6675 Requirement c: tax tobe paid when filing individually Tax tobe paid when filing jointly Federal tax savings [ 9,844-6,675 ] $ $ 9,844 6,675 Byfiling jointly, preston and anna can save $3,169 tax