[The following information applies to the questions displayed below.] Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their dependents (Damarcus; Jasmine, Michael, and Candice). The Jacksons file a joint tax return. The couple received salary income of $95,000 and qualified business income of $20,000 from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $250,000 and they sold it for $300,000. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $18,500 of itemized deductions, and they had $4,000 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the tax rate schedules.) a. What is the Jacksons' taxable income, and what is their tax liability or (refund)? Note: Do not round intermediate calculations. (1) Gross income (2) For AGI deductions (3) Adjusted gross income (4) Standard deduction (5) Itemized deductions Description (6) Greater of standard deduction or itemized deductions (7) Deduction for qualified business income (8) Total deductions from AGI (9) Taxable income (10) Income tax liability (11) Other taxes (12) Total tax (13) Credits (14) Prepayments Tax refund with tax return Amount $ 115,000 0 $ 115,000 18,500
[The following information applies to the questions displayed below.] Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their dependents (Damarcus; Jasmine, Michael, and Candice). The Jacksons file a joint tax return. The couple received salary income of $95,000 and qualified business income of $20,000 from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $250,000 and they sold it for $300,000. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $18,500 of itemized deductions, and they had $4,000 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the tax rate schedules.) a. What is the Jacksons' taxable income, and what is their tax liability or (refund)? Note: Do not round intermediate calculations. (1) Gross income (2) For AGI deductions (3) Adjusted gross income (4) Standard deduction (5) Itemized deductions Description (6) Greater of standard deduction or itemized deductions (7) Deduction for qualified business income (8) Total deductions from AGI (9) Taxable income (10) Income tax liability (11) Other taxes (12) Total tax (13) Credits (14) Prepayments Tax refund with tax return Amount $ 115,000 0 $ 115,000 18,500
Chapter6: Accounting Periods And Other Taxes
Section: Chapter Questions
Problem 12P: Otto and Monica are married taxpayers who file a joint tax return. For the current tax year, they...
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![[The following information applies to the questions displayed below.]
Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their
dependents (Damarcus; Jasmine, Michael, and Candice). The Jacksons file a joint tax return. The couple received
salary income of $95,000 and qualified business income of $20,000 from an investment in a partnership, and they
sold their home this year. They initially purchased the home three years ago for $250,000 and they sold it for
$300,000. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons
incurred $18,500 of itemized deductions, and they had $4,000 withheld from their paychecks for federal taxes. They
are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age
at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the
tax rate schedules.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F22620167-d4d0-4d30-b1d4-36ac1d8e9c7e%2Fc867ae16-d1f4-48a2-8362-f4f4ac932fe1%2Fq6obc1_processed.jpeg&w=3840&q=75)
Transcribed Image Text:[The following information applies to the questions displayed below.]
Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their
dependents (Damarcus; Jasmine, Michael, and Candice). The Jacksons file a joint tax return. The couple received
salary income of $95,000 and qualified business income of $20,000 from an investment in a partnership, and they
sold their home this year. They initially purchased the home three years ago for $250,000 and they sold it for
$300,000. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons
incurred $18,500 of itemized deductions, and they had $4,000 withheld from their paychecks for federal taxes. They
are also allowed to claim a child tax credit for each of their children. However, because Candice was 18 years of age
at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the
tax rate schedules.)
Transcribed Image Text:a. What is the Jacksons' taxable income, and what is their tax liability or (refund)?
Note: Do not round intermediate calculations.
(1) Gross income
(2) For AGI deductions
(3) Adjusted gross income
(4) Standard deduction
(5) Itemized deductions
Description
(6) Greater of standard deduction or itemized deductions
(7) Deduction for qualified business income
(8) Total deductions from AGI
(9) Taxable income
(10) Income tax liability
(11) Other taxes
(12) Total tax
(13) Credits
(14) Prepayments
Tax refund with tax return
Amount
$ 115,000
0
$
115,000
18,500
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