Question

Joanna is single and has 1 dependent children. She earns a gross yearly salary of $68,392. She will also make the following tax-deductible purchase: - Educational expenses: $9,515 Compute her final income tax. Use the following information: Heads of Household Taxable Income Is Between: The Tax Due is: 0 - $14,100 10% of taxable income $14, 101 - $53.700 $1.410 + 12% of the amount over $14,100 $53,701 - $85,500 $6.162 +22% of the amount over $53,700 $85,501 - $163,300 $13,158 +24% of the amount over $85,500 $163,301 - $207 350 $31,830 + 32% of the amount over $163,300 $207,351 - $518.400 $45.926 + 35% of the amount over $207 350 $518,401 S154.793,50 + 37% of the amount over $518 400 Standard deduction for heads of households: $18.650 Round your answer to the nearest dollar.

Answer 1

Hi there,

Here is my tax calculation to given question.

Facts are :

Gross taxable income =$68392

Education expense =$9515

Computation of Tax :

Total amount = 68392

Less : Education ezpense = 4000

Less : standard deduction = 18650

Net taxable income = $45,742

Tax : This falls under $14101 - $53700 slab rate ,

= $1410 + ($45742- $14101) * 12%

= $1410 + 3797

Tax = $5206

Note :

in case of education expense,

  

The amount of the American opportunity credit (per eligible student) is the sum of:

1. 100% of the first $2,000 of qualified education expenses you paid for the eligible student, and

2. 25% of the next $2,000 of qualified education expenses you paid for that student.

Here , we claimed $4000