Question

Stephanie is 12 years old and often assists neighbors on weekends by babysitting their children. Calculate the 2019 standard deduction Stephanie will claim (assume that Stephanie’s parents will claim her as a dependent).

1-Stephanie reported $300 of earnings from her babysitting.

2-Stephanie reported $1,300 of earnings from her babysitting.

3-Stephanie reported $13,000 of earnings from her babysitting.

Answer 1

Answer:

As per us tax laws, Standard deduction which a dependent can claim in 2019 shall be

= Greater of 1,100$ (or) 350$ + Income of dependent (Without exceeding regular standard deduction)

Now, as per question

1) Stephanie reported $300 of earnings from her babysitting.

= Greater of 1,100$ or 350$ + 300$ = 650$

= the greater anount is 1,100$

Therefore standard deduction which stephanie can claim is 1,100$

2) Stephanie reported $1,300 of earnings from her babysitting.

= Greater of 1,100$ or 350$ + 1,300$ = 1,650$

= the greater anount is 1,650$

Therefore standard deduction which stephanie can claim is 1,650$

3) Stephanie reported $13,000 of earnings from her babysitting.

= Greater of 1,100$ or 350$ + 13,000$ = 13,350$

But the amount of 13,350 $ shall be limited to 12,200$ (Regular standard deduction for single tax payer for the year 2019) as per us tax laws

Hence, the standard deduction shall be limited to 12,200$

Therefore standard deduction which stephanie can claim is 12,200$

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