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Determine the amount of taxes owed or the refund that would result in this situation: • Filing Status: Married filing jointly . Gross Income: $125,000 • Adjustments: $6,900 Itemized Deductions: $10,400 • Credits and Withholdings: $15,000 a. What is their adjusted gross income (AGI)? b. Should they itemize or take the standard deduction? take the standard deduction itemize c. Use the simplified 2018 tax tables to determine their taxable income. "Remember to subtract the deduction to determine the taxable income. d. Determine their tax using the 2018 tax table e. What is their final tax refund or amount still owed (if they owe enter the number as a negative)?

Determine the amount of taxes owed or the refund that would result in this situation: • Filing Status: Married filing jointly . Gross Income: $125,000 • Adjustments: $6,900 Itemized Deductions: $10,400 • Credits and Withholdings: $15,000 a. What is their adjusted gross income (AGI)? b. Should they itemize or take the standard deduction? take the standard deduction itemize c. Use the simplified 2018 tax tables to determine their taxable income. "Remember to subtract the deduction to determine the taxable income. d. Determine their tax using the 2018 tax table e. What is their final tax refund or amount still owed (if they owe enter the number as a negative)?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Determine the amount of taxes owed or the refund that would result in this situation: • Filing Status: Married filing jointly . Gross Income: $125,000 . Adjustments: $6,900 • Itemized Deductions: $10,400 • Credits and Withholdings: $15,000 a. What is their adjusted gross income (AGI)? b. Should they itemize or take the standard deduction? take the standard deduction Ⓒitemize c. Use the simplified 2018 tax tables to determine their taxable income. "Remember to subtract the deduction to determine the taxable income. d. Determine their tax using the 2018 tax table e. What is their final tax refund or amount still owed (if they owe enter the number as a negative)? Standard deduction Married filing jointly and surviving spouses Single (other than surviving spouses and heads of households) Heads of households Married filing separately Personal Exemption: None $24,000 $12,000 $18,000 $12,000 Single (other than surviving spouses and heads of households) If taxable income is: The tax is: Not over $9,525 10% of the taxable income $952.50 plus 12% of the excess over $9,525 $4,453.50 plus 22% of the excess over $38,700 $14,089.50 plus 24% of the excess over $82,500 $32,089.50 plus 32% of the excess over $157,500 Over $9,525 but not over $38,700 Over $38,700 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000
Transcribed Image Text:Determine the amount of taxes owed or the refund that would result in this situation: • Filing Status: Married filing jointly . Gross Income: $125,000 . Adjustments: $6,900 • Itemized Deductions: $10,400 • Credits and Withholdings: $15,000 a. What is their adjusted gross income (AGI)? b. Should they itemize or take the standard deduction? take the standard deduction Ⓒitemize c. Use the simplified 2018 tax tables to determine their taxable income. "Remember to subtract the deduction to determine the taxable income. d. Determine their tax using the 2018 tax table e. What is their final tax refund or amount still owed (if they owe enter the number as a negative)? Standard deduction Married filing jointly and surviving spouses Single (other than surviving spouses and heads of households) Heads of households Married filing separately Personal Exemption: None $24,000 $12,000 $18,000 $12,000 Single (other than surviving spouses and heads of households) If taxable income is: The tax is: Not over $9,525 10% of the taxable income $952.50 plus 12% of the excess over $9,525 $4,453.50 plus 22% of the excess over $38,700 $14,089.50 plus 24% of the excess over $82,500 $32,089.50 plus 32% of the excess over $157,500 Over $9,525 but not over $38,700 Over $38,700 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000
Over $200,000 not over $500,000 Over $500,000 Heads of households If taxable income is: Not over $13,600 Over $13,600 but not over $51,800 Over $51,800 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 not over $500,000 Over $500,000 $45,689.50 plus 35% of the excess over $200,000 $150,689.50 plus 37% of the excess over $500,000 The tax is: 10% of the taxable income $1,360 plus 12% of the excess over $13,600 $5,944 plus 22% of the excess over $51,800 $12,698 plus 24% of the excess over $82,500 $30,698 plus 32% of the excess over $157,500 $44,298 plus 35% of the excess over $200,000 $149,298 plus 37% of the excess over $500,000
Transcribed Image Text:Over $200,000 not over $500,000 Over $500,000 Heads of households If taxable income is: Not over $13,600 Over $13,600 but not over $51,800 Over $51,800 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 not over $500,000 Over $500,000 $45,689.50 plus 35% of the excess over $200,000 $150,689.50 plus 37% of the excess over $500,000 The tax is: 10% of the taxable income $1,360 plus 12% of the excess over $13,600 $5,944 plus 22% of the excess over $51,800 $12,698 plus 24% of the excess over $82,500 $30,698 plus 32% of the excess over $157,500 $44,298 plus 35% of the excess over $200,000 $149,298 plus 37% of the excess over $500,000
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