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21 February, 09:19

Frank, age 35, and Joyce, age 34, are married and file a joint income tax return for 2019. Their salaries for the year total $84,800 and they have taxable interest income of $3,900. They have no deductions for adjusted gross income. Their itemized deductions are $24,700. Frank and Joyce do not have any dependents.

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  1. 21 February, 10:52
    The question is not complete.

    Here is the complete part:

    Table for the standard deduction

    Filing Status 2018 Standard Deduction

    Single $ 12,000

    Married, filing jointly $24,000

    Married, filing separately $12,000

    Head of household $18,000

    Qualifying widow (er) $24,000

    If an amount is zero, enter "0".

    a. What is the amount of their adjusted gross income?


    b. What is their deduction for personal exemptions?


    c. What is the amount of their taxable income?


    Here are the answers:

    a. Adjusted Gross Income = $88,700

    b. Personal exemptions = $0

    c. Taxable Income = $64,000


    a. Adjusted Gross Income is calculated by adding income from various sources and subtracting any specific deductions.

    For Frank and Joyce, the adjusted gross income is:

    $84,800 + $3,900 - $0 (no deductions for adjusted gross income) = $88,700.

    b. Personal exemptions equals is $0 because it has been phased out in 2017.

    c. The taxable income is derived by deducting standard deduction or itemized deductions (whichever is higher) from adjusted gross income.

    Taxable income = Adjusted gross income - deductions (standard or item-whichever is higher).

    The standard deductions of $24,000 for married, filling jointly is lower than their itemized deductions, so the latter will be used.

    Hence, the taxable income = $88,700 - $24,700

    Taxable income = $64,000
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