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María, age 32, earns $60,000 working in 2021. She has no other income. Her medical expenses for the year total $6,000. During the year, she suffers a casualty loss of $9,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). María contributes $6,000 to her church and pays $4,000 of state income taxes. On the advice of her friend, María is trying to decide whether to Contribute $5,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on María's itemized deductions. Gross income Contribution to IRA AGI Itemized deductions: Charitable contribution State income taxes Medical expenses Casualty loss Total itemized deductions With IRA Contribution $ $ $ $ (5,000) The $5,000 IRA contribution would contribution reduces her taxable income by $ Without IRA Contribution 0 00000 María's itemized deductions by $ As a result, the $5,000 IRA

María, age 32, earns $60,000 working in 2021. She has no other income. Her medical expenses for the year total $6,000. During the year, she suffers a casualty loss of $9,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). María contributes $6,000 to her church and pays $4,000 of state income taxes. On the advice of her friend, María is trying to decide whether to Contribute $5,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on María's itemized deductions. Gross income Contribution to IRA AGI Itemized deductions: Charitable contribution State income taxes Medical expenses Casualty loss Total itemized deductions With IRA Contribution $ $ $ $ (5,000) The $5,000 IRA contribution would contribution reduces her taxable income by $ Without IRA Contribution 0 00000 María's itemized deductions by $ As a result, the $5,000 IRA

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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Problem 6-35 (LO. 1) María, age 32, earns $60,000 working in 2021. She has no other income. Her medical expenses for the year total $6,000. During the year, she suffers a casualty loss of $9,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). María contributes $6,000 to her church and pays $4,000 of state income taxes. On the advice of her friend, María is trying to decide whether to contribute $5,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on María's itemized deductions. Gross income Contribution to IRA AGI Itemized deductions: Charitable contribution State income taxes Medical expenses Casualty loss Total itemized deductions With IRA Contribution $ $ (5,000) The $5,000 IRA contribution would contribution reduces her taxable income by $ Without IRA Contribution 0 00000 María's itemized deductions by $ As a result, the $5,000 IRA
Transcribed Image Text:Problem 6-35 (LO. 1) María, age 32, earns $60,000 working in 2021. She has no other income. Her medical expenses for the year total $6,000. During the year, she suffers a casualty loss of $9,500 when her apartment is damaged by flood waters (part of a Federally declared disaster area). María contributes $6,000 to her church and pays $4,000 of state income taxes. On the advice of her friend, María is trying to decide whether to contribute $5,000 to a traditional IRA. Complete the table to show the effect the IRA contribution would have on María's itemized deductions. Gross income Contribution to IRA AGI Itemized deductions: Charitable contribution State income taxes Medical expenses Casualty loss Total itemized deductions With IRA Contribution $ $ (5,000) The $5,000 IRA contribution would contribution reduces her taxable income by $ Without IRA Contribution 0 00000 María's itemized deductions by $ As a result, the $5,000 IRA
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