Camille Sikorski was divorced in 2018. She currently owns and provides a home for her 15-year-old...

Camille Sikorski was divorced in 2018. She currently owns and provides a home for her 15-year-old daughter. Kaly lived in Camille’s home for the entire year and Camille paid for all the costs of maintaining the home. Camille received a salary of $105,000 and contributed $6,000 of it to a qualified retirement account (a for AGI deduction). She also received $10,000 of alimony from her former husband (per divorce decree issued in 2018). Finally, Camille paid $15,000 of expenditures that qualified as itemized deductions. What is Camille’s taxable income? What would Camille’s taxable income be if she incurred $24,000 of itemized deductions instead of $15,000?

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Expert Solution

Given in the question :-

Salary - $105000

Contribution to qualified retirement account ( AGI deduction) - $6000

Alimony - $10000

1) Expenditures ( itemized deductions) - $15000

Salary + alimony = $115000

Less - AGI deduction = $18650 ( Head of household)

Thus, her taxable income will be $115000- $18650 = $ 96350

2) Expenditures ( itemized deductions) - $24000

Salary + alimony = $115000

Less : itemized deductions = $24000

Thus, her taxable income will be $91000

Rahul Sunny answered 2 years ago

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