Question

6.The table below lists some information relevant to the taxes paid by Joe. Item Wages and salary Pension Health Insurance Interest Income and Dividends State Income Taxes paid Pr State and Local Sales Tazes Amount 50,000 5,000 3.000 1.000 1.500 1,500 1,000 5,000 1.000 over xes ortgage Interest Pavments Charitable Contnbutions Medical nses (not covered by Insurance 500 Joe is single with no dependents. He earns his $50,000 in wages by working 2,500 hours a year (50 hours a week for 50 weeks a year) at $20 an hour. Under the current tax code, the standard deduction for a single filer was $4,300 and the personal exemption was $2,750. The tax rate schedule for a single individual is given by Taxable Income ах Over But Not Oter $25,750 62,450 150,250 of amount over 525,750 62,450 15% $3,862.50 + 28% 14,138.50 31% 25,750 62,450 a) Based on the above information detemine the adjusted gross income, taxable income, and taxes paid by Joe. Be sure to explain how vou arived at vour answer. Adjusted Gross Income Taxable Income Taxes Paid

Answer 1

a) adjusted gross income:41500

b)taxable income: 34450

c) taxes paid 6298.5

working
wages and salary			50000
add: interest nad dividend			1000
	total income		51000
less:	taxes and expenses
	state income tax paid		1500
	property tax paid		1500
	mortgage interest paid		5000
	charitable contribution		1000
	medical expenses		500
	adjusted gross income		41500
less:	standard deduction		4300
	personel exemption		2750
	net taxable income		34450
	taxes paid =		3862.50 +28%(34450-25750)
			3862.50+2436
			6298