Question

FNC 1) The Lees, a family of two adults and two dependent children under age 16, had a gross annual income of $68,000 for 2017. Determine their standard deduction, exemption, and child tax credit amounts, as well as their marginal and average tax rates, assuming their filing status is married filing jointly. 9) Calculate the 2017 total tax for Gordon Geist, a single taxpayer with no dependents and no itemized deductions. He has an active income of $40,000, a short-term capital gain income of $4,000 from the sale of stock, and $7,800 from book royalties. What is Gordon's average tax rate?

Answer 1

For the First Part  

The Lees
			For the Year 2017
Statement of Income
			(In Dollars)
Gross Annual Income			68000
			68000
Standard Deduction			12700
Income after Standard Deduction			55300
Child Tax Credit ( For Two Children)			5616
			49684
Income after Child Tax Credit			49684
Taxes @10% upto $ 18,650			1865
Taxes @15% on $ 31034 (Balance Amount)			4655
Total Tax Payable			6520

For the Part 2

Mr. Gordon Geist
			For the Year 2017
Statement of Income
			(In Dollars)
Active Income			40000
Short Term Capital Gain			4000
Bank Royalities			7800
			51800
As the Income is under the 25% tax bracket
Total Tax Payable
Short term capital gain will be calculated @25%		1000
Balance Taxes as per the Slab Rate
Taxes @10% upto $ 9325			933
Taxes @15% on $ 37950			5693
Taxes @25% on $ 525(Balance Amount)			131
Total taxes to be paid			7757