Problem 6: Tax Credits Ted and Julia Higgins are married for all of 2023 with an AGI of $175,000 which includes $25,000 of earned income for Ted and $100,000 of earned income for Julie. Their taxable income is 145,000 and tax liability is $20,000. They have two children, Bryan and Sophia, who meet all of the requirements of a qualifying child for 2023. Bryan is 12 and attends high school full time. The Higgins spend $10,000 during 2023 on child care for Bryan. Sophia is a full-time student in her junior year at UCR. The Higgins spend $6,000 on tuition, books and other course materials for Sophia during 2023. Required: What is the total amount of tax credits that the Higgins' can report on their tax return?
Problem 6: Tax Credits Ted and Julia Higgins are married for all of 2023 with an AGI of $175,000 which includes $25,000 of earned income for Ted and $100,000 of earned income for Julie. Their taxable income is 145,000 and tax liability is $20,000. They have two children, Bryan and Sophia, who meet all of the requirements of a qualifying child for 2023. Bryan is 12 and attends high school full time. The Higgins spend $10,000 during 2023 on child care for Bryan. Sophia is a full-time student in her junior year at UCR. The Higgins spend $6,000 on tuition, books and other course materials for Sophia during 2023. Required: What is the total amount of tax credits that the Higgins' can report on their tax return?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Problem 6: Tax Credits
Ted and Julia Higgins are married for all of 2023 with an AGI of $175,000 which
includes $25,000 of earned income for Ted and $100,000 of earned income for
Julie. Their taxable income is 145,000 and tax liability is $20,000.
They have two children, Bryan and Sophia, who meet all of the requirements of a
qualifying child for 2023. Bryan is 12 and attends high school full time. The
Higgins spend $10,000 during 2023 on child care for Bryan. Sophia is a full-time
student in her junior year at UCR. The Higgins spend $6,000 on tuition, books and
other course materials for Sophia during 2023.
Required: What is the total amount of tax credits that the Higgins' can report on
their tax return?
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