Required: What are the Fergusons’ 2022 federal income taxes payable or refund, including any self-employment tax and AMT, if applicable? Complete Form 1040 (starting from line 15 “taxable income”) for Sandy and John.
The problem in the textbook is modified as below:
Sandy and John Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. They file a joint return. In 2022, Sandy worked as a computer technician at a local university earning a salary of $152,000, and John worked part time as a receptionist for a law firm earning a salary of $29,000. Sandy also does some Web design work on the side and reported revenues of $4,000 and associated expenses of $750. The Fergusons always itemize their deductions, and their itemized deductions were well over the standard deduction amount last year. The Fergusons reported making the following payments during the year:
- Sandy Ferguson’s earned income = Salary $152,000 + Net earnings from self-employment (= net business income × 92.35%).
- Applicable percentage is 20%.
- Assume the child and dependent care credit is entered on line 20 in Form 1040.
Required: What are the Fergusons’ 2022 federal income taxes payable or refund, including any self-employment tax and AMT, if applicable? Complete Form 1040 (starting from line 15 “taxable income”) for Sandy and John.
Step by step
Solved in 3 steps with 2 images
