Victor and Lorraine,
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Victor and Lorraine, ages 45 and 47, respectively, are married and are cash basis taxpayers.
They had the following tax items for 2021:
Salaries of $61,000
Collection of unpaid rent from a prior year of $4,000
Rental income of $60,000 (property is managed by Victor and Lorraine - does not include collection from above)
Rental expenses of $53,000 (does not include bad debt above)
Personal casualty loss (from one event; a flood after a storm) of $2,000; not in a Federally declared disaster area.
There is not enough information to know if they are eligible to deduct the Qualified Business Income credit, so ignore this for now.
Other itemized deductions of $21,000.
They wish to file as married filing jointly.
Calculate the following:
1) Adjusted Gross Income
2) Taxable income
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