Problem 7-19Education Tax Credits (LO 7.5)Janie graduates from high school in 2021 and enrolls in college in the fall. Her parents (who file a joint return) pay $4,000 for her tuition and fees.a. Assuming Janie's parents have AGI of $172,000, what is the American Opportunity tax credit they can claim for Janie?b. Assuming Janie's parents have AGI of $75,000, what is the American Opportunity tax credit they can claim for Janie?

On first $ 2,000 2,000 =2000*100% On Next $2,000 500 =2000*25% Total credit…

Answered: Problem 7-19 Education Tax Credits (LO…

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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Q.7. In 2020, Henry Jones (Social Security number 123-45-6789) works as a freelance driver, finding customers using various platforms like Uber and Grubhub. He is single and has no other sources of income. In 2020, Henry's qualified business income from driving is $116,200. Assume Henry takes the standard deduction of $12,400. Click here to access the 2020 individual tax rate schedule to use for this problem. Assume the QBI amount is net of the self-employment tax deduction. a. Compute Henry's QBI deduction and his tax liability for 2020. QBI deduction: $_____ Tax liability (round to the nearest dollar): $____
Problem 7-6Earned Income Credit (LO 7.2) Diane is a single taxpayer who qualifies for the earned income credit. Diane has two qualifying children who are 3 and 5 years old. During 2023, Diane's wages are $21,000 and she receives dividend income of $1,200. Other Than Joint Filers Joint Filers QualifyingChildren Phase-outBegins Phase-outEnds Phase-outBegins Phase-outEnds None $9,800 $17,640 $16,370 $24,210 1 21,560 46,560 28,120 53,120 2 21,560 52,918 28,120 59,478 3 or more 21,560 56,838 28,120 63,398 Calculate Diane's earned income credit using the EIC table in Appendix B.
Problem 9-23 (Algorithmic) (LO. 4, 5) Chris and Heather are engaged and plan to get married. During 2023, Chris is a full-time student and earns $7,600 from a part-time job. With this income, student loans, savings, and nontaxable scholarships, he is self-supporting. For the year, Heather is employed and has wages of $79,200. Click here to access the standard deduction table to use. Click here to access the Tax Rate Schedules. If an amount is zero, enter, "0". Do not round your intermediate computations. Round your final answer to the nearest whole dollar. a. Compute the following: Gross income and AGI Standard deduction (single) Taxable income Income tax Q Search Filing Single S PRE ta Chris LA L Heather 1 Filing Single b. Assume that Chris and Heather get married in 2023 and file a joint return. What is their taxable income and income tax? Round your final answer to the nearest whole dollar. SA SA SA 7:29 2/8/2
Data: In 2020, Elaine paid $2,160 of tuition and $900 for books for her dependent son to attend State University this past fall as a freshman. Elaine files a joint return with her husband - AGI $165,500. Question: What is the maximum American opportunity tax credit that Elaine can claim for the tuition payment and books ? Thx, Stephanie
Larry purchased an annuity from an insurance company that promises to pay him $6,500 per month for the rest of his life. Larry paid $626,340 for the annuity. Larry is in good health and is 72 years old. Larry received the first annuity payment of $6,500 this month. Use the expected number of payments in Exhibit 5-1 for this problem. Problem 5-59 Part-c (Algo) c. What are the tax consequences if Larry dies just after he receives the 100th payment?
Income Tax Credits (LO. 6) Refer to Exhibit 8-5 and 8A-1 SCHEDULE EIC (EARNED INCOME CREDIT) 2018 EARNED INCOME CREDIT TABLE to answer the following questions. Determine the total allowable 2018 earned income credit in each of the following situations: a. Rina is single and earns $6,800 in salary for the year. In addition, she receives $2,200 in unemployment compensation during the year. b. C. Lachlan is single with one dependent child. During the year, he earns $8,000 as a waiter and receives alimony of $10,000 and child support of $5,000. Zorica is a single parent with two dependent children. She earns $19,000 from her job as a mechanic. She also receives $3,000 in child support from her ex-husband. d. Elliot and Pam are married and have three dependent children. Elliot and Pam earn $12,000 and $9,000 from their jobs, respectively. They receive $800 in interest and $1,000 in dividend income. Assume the taxpayer files a joint return.
Problem 8 - 70 (LO 8-4) (Algo) Skip to question [The following information applies to the questions displayed below.] Trey has two dependents, his daughters, ages 14 and 18, at year - end. Trey files a joint return with his spouse. What amount of child tax credit (either as a child or a qualifying dependent) will Trey be able to claim in 2023 for his daughters under each of the following alternative situations? Use Exhibit 8 - 8. Problem 8 - 70 Part a (Algo) a. His AGI is $103,300. b. His AGI is $431, 000. EXHIBIT 8 -8 Child Tax Credit Phase - Out Threshold S EXHIBIT 8-8 Child Tax Credit Phase-Out Threshold Filing Status Married filing jointly Married filing separately Head of household and single Phase-Out Threshold $400,000 200,000 200,000
Problem 3-42 (Algorithmic) (LO. 5, 6, 9) David and Ruby are engaged and plan to get married. During 2020, David is a full-time student and earns $6,700 from a part-time job. With this income, student loans, savings, and nontaxable scholarships, he is self-supporting. For the year, Ruby is employed and has wages of $55,000. Click here to access the standard deduction table to use. Click here to access the Tax Rate Schedules. If an amount is zero, enter, "0". Do not round your intermediate computations. Round your final answer to nearest whole dollar. a. Compute the following: Gross income and AGI Standard deduction Taxable income Income tax $ David Filing Single 6,700 12,400 0 0 Ruby Filing Single 55,000 12,400 42,600 7,668 X
! Required information [The following information applies to the questions displayed below.] In 2023, Elaine paid $2,800 of tuition and $640 for books for her dependent son to attend State University this past fall as a freshman. Elaine files a joint return with her husband. What is the maximum American opportunity tax credit that Elaine can claim for the tuition payment and books in each of the following alternative situations? Note: Leave no answer blank. Enter zero if applicable. a. Elaine's AGI is $83,200. Answer is complete but not entirely correct. American opportunity tax credit $ 83,200
Problem 7-21 (Algorithmic) Foreign Tax Credit (LO 7.6) Martha and Lew are married taxpayers with $2,000 of foreign tax withholding from dividends in a mutual fund. They have enough foreign income from the mutual fund to claim the full $2,000 as a foreign tax credit. Their tax bracket is 28 percent and they itemize deductions. Should they claim the foreign tax credit or a deduction for foreign taxes on their Schedule A? If required, round your answer to the nearest dollar. The foreign tax deduction will result in a s tax benefit where as claiming the foreign tax credit yields a $ tax benefit. Therefore, the taxpayers should
aa.6 Scot and Vidia, married taxpayers, earn $184,000 in taxable income and $5,000 in interest from an investment in City of Tampa bonds. (Use the U.S. tax rate schedule). a If Scot and Vidia earn an additional $81,250 of taxable income, what is their marginal tax rate on this income? b. How would your answer differ if they, instead, had $81,250 of additional deductions?
26. LO3 Determine the maximum deduction from AGI for 2018 for each of the following taxpayers: a. Pedro is single and maintains a household for his father. His father is not a dependent of Pedro's. Pedro's itemized deductions are $12,100. b. Jie and Ling are married. Jie is 66 years old, and Ling is 62. They have itemized deductions of $19,000. c. Myron and Samantha are married, and both are 38 years of age. Samantha is legally blind. They have itemized deductions of $24,500. d. Joelynn is divorced and maintains a home for her 21-year-old son, who is a part-time student at the local university. He pays less than one-half of his support and his earned income for the year is $3,900. Her itemized deductions are $17,000. e. Frank is 66 years of age. During the year, his wife dies. His itemized deductions are $23,700. f. Assume the same facts as in part e, except that Frank's wife dies in 2016.

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