Question

Camille Sikorski was divorced last year. She currently provides a home for her 15-year-old daughter, Kaly, and 18-year-old son, Parker. Both children lived in Camille’s home, which she owns, for the entire year, and Camille paid for all the costs of maintaining the home. She received a salary of $55,000 and contributed $4,200 of it to a qualified retirement account (a for AGI deduction). She also received $6,000 of alimony from her former husband. Finally, Camille paid $2,700 of expenditures that qualified as itemized deductions.

a. What is Camille’s taxable income?

b. What would Camille’s taxable income be if she incurred $9,800 of itemized deductions instead of $2,700?

c. Assume the original facts but now suppose Camille’s daughter, Kaly, is 25 years old and a full-time student. Kaly’s gross income for the year was $5,300. Kaly provided $3,180 of her own support, and Camille provided $5,300 of support. What is Camille’s taxable income?

#6 is it Greater of standard deduction or itemized deduction or is it Lesser of standard deduction or itemized deduction

	Description	Amount
1)	Gross income
2)	For AGI deductions
3)	Adjused gross income	$
4)	Standard deduction
5)	Itemized deductions
6)
7)	Personal and dependency exemptions
8)	Total deductions from AGI	$
	Taxable income

Answer 1

Part A

Gross income	61000 (55000+6000)
For AGI deductions	4200
Adjusted gross income	56800 (61000-4200)
Standard deduction (2017 basis and Camille qualifies as head of household)	9350
Itemized deduction	2700
Greater of standard and itemized deduction	9350
Personal and dependency exemption (4050*3)(2017 basis)	12150
Total deductions for AGI	21500
Taxable income	35300

Part 2

Gross income	61000
For AGI deductions	4200
Adjusted gross income	56800
Standard deduction	9350
Itemized deduction	9800
Greater of standard and itemized deduction	9800
Personal and dependency exemption	12150
Total deductions for AGI	21950
Taxable income	34850

Part C

Gross income	61000
For AGI deductions	4200
Adjusted gross income	56800
Standard deduction	9350
Itemized deduction	2700
Greater of standard and itemized deduction	9350
Personal and dependency exemption (4050*2)	8100
Total deductions for AGI	17450
Taxable income	39350