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6 June, 01:19

In 2016, Lou has a salary of $53,300 from her job. She also has interest income of $1,600 and dividend income of $400. Lou is single and has no dependents. During the year, Lou sold silver coins held as an investment for a $7,000 loss.

Table for the standard deduction Filing Status 2016 Standard Deduction

Single $ 6,300

Married, filing jointly 12,600

Married, filing separately 6,300

Head of household 9,300

Qualifying widow (er) 12,600

Calculate the following amounts for Lou:

a. Adjusted gross income $

b. Standard deduction $

c. Exemption $

d. Taxable income

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Answers (1)
  1. 6 June, 01:45
    0
    The computations are shown below:

    a. Adjusted gross income

    = Salary + interest income + dividend income - deduction for capital loss

    = $53,300 + $1,600 + $400 - $3,000

    = $52,300

    The capital loss deduction is up to $3,000 only

    b. The standard deduction in the case of single is $6,300

    c. The personal exemption in the year 2016 is $4,050

    d. The taxable income is

    = $52,300 - $6,300 - $4,050

    = $41,950
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