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 that in addition to the original facts, Jeremy has a long-term capital gain of $14,050. What is Jeremy’s tax refund or tax due including the tax on the capital gain

Answer 1

	Description	Amount ($)	Computation
1	Salary	$ 102,100.00
2	Interest Income	$     8,100.00
3	Capital Gains	$   14,050.00
4	Gross Income	$ 124,250.00	(1+2+3)
5	For AGL Deductions	$                -
6	Adjusted Gross Income	$ 124,250.00	(4-5)
7	Standard Deduction	$   18,000.00	Head of Household - 2018
8	Itemised Deduction	$   32,700.00
9	Greater of standard deduction or itemized deduction	$   32,700.00
10	Personal and dependency exemptions	$                -	Repealed in 2018
11	Taxable income	$   91,550.00	(5-9-10)
12	Income tax liability	$   13,705.50	(5944+(77500-51800)*22%)+(14050*15%)
13	Child Tax Credit	$     2,000.00
14	Tax Witheld	$   11,000.00
15	Tax due	$        705.50	(12-13-14)