Question

Jeremy earned $102,100 in salary and $8,100 in interest income during the year. Jeremy’s employer withheld $11,000 of federal income taxes from Jeremy’s paychecks during the year. Jeremy has one qualifying dependent child who lives with him. Jeremy qualifies to file as head of household and has $32,700 in itemized deductions. (Use the tax rate schedules.) Assume the original facts except that Jeremy has only $7,000 in itemized deductions. What is Jeremy’s tax refund or tax due?

Answer 1

Calculation of Jeremy's tax refund or Taxes due			Tax liability calculation
1. Gross Income (102100+8100)	110200		13850*10%=	1385
2. For AGI deductions			(52850-13850)*12%=	4680
3. Adjusted gross income	110200		(77500-52850)*22%=	5423
4.Standard deduction	18350		Total	11488
5.Itemized deductions	32700
6. Greater of standard deduction or itemized deductions	32700
7.Taxable income(110200-32700)	77500
8.Income tax liability(6065+((78400-52850)*22%)	11488	6065+((77500-52850)*22%)
9. Child tax credit	2000
10.Tax withholding by employer	11000
11.Tax refund due(8-9-10)	-1512

Calculation of Jeremy's tax refund or Taxes due			Tax liability calculation
1. Gross Income (102100+8100)	110200		13850*10%=	1385
2. For AGI deductions			(52850-13850)*12%=	4680
3. Adjusted gross income	110200		(84200-52850)*22%=	6897
4.Standard deduction	18350		(91850-84200)*24%=	1836
5.Itemized deductions	7000		Total	14798
6. Greater of standard deduction or itemized deductions	18350
7.Taxable income(110200-18350)	91850
8.Income tax liability (12962+((91850-84200)*24%)	14798	12962+((91850-84200)*24%)
9. Child tax credit	2000
10.Tax withholding by employer	11000
11.Balance Tax due(8-9-10)	1798