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the following information is avaiable for Tom and Susan Smith, a married couple filling a joint...

the following information is avaiable for Tom and Susan Smith, a married couple filling a joint return for 2019. Tom is 67 and Susan is 64. They have a son, Sam, who is 27 years old, live with them all year and had 2000 of income. They have the following items for 2019.

Salaries $225,000

City of Fresno bond interest income $1800

Interest income from coporate bond $2200

Rental income (rented for entire year) $50000

Rental expense (interest, tax, repair) $20000

Loss on sale of personal use vehicle $3000

Personal bad debt - loan to a friend $7000

Tom contributed to IRA account $7000

Itemized deduction $25000

Federal tax withold on wages $30000

Caculate the following:

1. what is the amount of ther AGI?

2. What is the amount of their taxable income?

3. What is the amount of federal taxes?

4. What is the amount of their child and a dependent tax credit?

5. what is their tax balance due or refund?

Solutions

Expert Solution

    Adjusted Gross income          
           $  
   Salaries       225000  
              
   city of fresh bond interest income       1800  
              
   interest income from corporate bond       2200  
              
   rental income   50000      
   rental expenses    20000   30000  
              
1   AGI-=   $   259000  
              
              
   Taxable Income   AGI $   259000  
   less           
   deduction       24400  
   contribution to IRS       6000  
              
2   TAXABLE INCOME   $   228600  
              
3   FEDERAL TAXES FOR 2019=        43213  
   28765+(228600-168400)*0.24          
              
              
5   TAX REFUND/payable       43213  
   LESS:-TAX PAID       30000  
   Tax payable        13213  
              
4   they will not be entitled to child and dependent tax credit as age of SAM   should be under 17 and also he does not qualify dependent test also as he is more than 24 years old           

ekkarill92 answered 1 year ago
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