Question

Arthur and Cora are married and have 2 dependent children. They have a gross income of $95,730. Their allowable deductions for adjusted gross income total $5,230, and they have total allowable itemized deductions of $26,000. The standard deduction for 2019 is $24,400. Refer to the Tax Rate Schedules to answer the following questions. Round intermediate computations and final answer to the nearest dollar. Note: The child tax credit in 2019 is $2,000 per child.

a. Arthur and Cora's 2019 taxable income is $64,500

b. Arthur and Cora's 2019 income tax is $________

c. If Arthur has $2,700 and Cora has $900 withheld from their paychecks then they are entitled to a refund of $ ____________

2019 Tax Rates Single Taxable Income $0 - $9,700 $9,701 - $39,475 $39,476 - $84,200 $84,201 - $160,725 $160,726 - $204,100 $204,101 - $510,300 $510,301 or more Tax Rate 10% of taxable income $970.00 plus 12% of the amount over $9,700 $4,543.00 plus 22% of the amount over $39,475 $14,382.00 plus 24% of the amount over $84,200 $32,748.00 plus 32% of the amount over $160,725 $46,628.50 plus 35% of the amount over $204,100 $153,798.50 plus 37% of the amount over $510,300 Married Filing Jointly or Qualifying Widow(er) Taxable Income Tax Rate $0 - $19,400 10% of taxable income $19,401 - $78,950 $1,940.00 plus 12% of the amount over $19,400 $78,951 - $168,400 $9,086.00 plus 22% of the amount over $78,950 $168.401 - $321,450 $28,765.00 plus 24% of the amount over $168,400 $321,451 - $408,200 $65,497.00 plus 32% of the amount over $321,450 $408,201 - $612,350 $93,257.00 plus 35% of the amount over $408,200 $612,351 or more $164,709.50 plus 37% of the amount over $612,350 Head of Household Taxable Income Tax Rate $0 - $13,850 10% of taxable income $13,851 - $52,850 $1,385.00 plus 12% of the amount over $13,850 $52,851 - $84,200 $6,065.00 plus 22% of the amount over $52,850 $84,201 - $160,700 $12,962.00 plus 24% of the amount over $84,200 $160,701 - $204,100 $31,322.00 plus 32% of the amount over $160,700 $204,101 - $510,300 $45,210.00 plus 35% of the amount over $204,100 $510,301 or more $152,380.00 plus 37% of the amount over $510,300

Answer 1

Answer:

a)

Gross income	$ 95,730
Deduction for AGI	$5,230
AGI	$90,500
Less: Greater of standard or itemized deduction	$26,000
Taxable income	$64,500

b)

Gross income tax (1940)+($64,500 - 19,400)*12%	$7,352
Less:Child tax credit(2000*2)	$4,00
Arthur and cora's 2019 income tax	$3,352

c)They are entitle to a refund of $248 ($3,352 - $2,700 - $900)