Question & Answer: Compute the taxable income for 2017 in each of the following independent situations. The personal exemptio…..

Compute the taxable income for 2017 in each of the following independent situations. The personal exemption amount for 2017 is $4,050. Click here to access the standard deduction table to use if required.

a. Drew and Meg, ages 40 and 41, respectively, are married and file a joint return. In addition to four dependent children, they have AGI of $65,000 and itemized deductions of $15,000.

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AGI	$65,000
Less: itemized deductions
Less: personal and dependency exemptions
Taxable income

b. Sybil, age 40, is single and supports her dependent parents who live with her, as well as her grandfather who is in a nursing home. She has AGI of $80,000 and itemized deductions of $8,000.

AGI	$80,000
Less: standard deduction
Less: personal and dependency exemptions
Taxable income	$

c. Scott, age 49, is a surviving spouse. His household includes two unmarried stepsons who qualify as his dependents. He has AGI of $75,000 and itemized deductions of $10,100.

AGI	$75,000
Less:
Less: personal and dependency exemptions
Taxable income	$

d. Amelia, age 33, is an abandoned spouse who maintains a household for her three dependent children. She has AGI of $58,000 and itemized deductions of $9,500.

AGI	$58,000
Less:
Less: personal and dependency exemptions
Taxable income	$

e. Dale, age 42, is divorced but maintains the home in which he and his daughter, Jill, live. Jill is single and qualifies as Dale’s dependent. Dale has AGI of $64,000 and itemized deductions of $9,900.

AGI	$64,000
Less:
Less: personal and dependency exemptions
Taxable income	$

Expert Answer

Answer:	Computation of the taxable income for 2017 in each of the following independent situations

a	AGI	$65,000
	Less: itemized deductions	15000
	Less: personal and dependency exemptions	24300	($4,050 * 6)
	Taxable income	$25,700

	Note:
	Since their itemized deduction i.e.$15,000 is more than standard deduction i.e.$12,700, it is beneficial to take itemized deduction

b	AGI	$80,000
	Less: standard deduction (Head of household)	$ 9,350
	Less: personal and dependency exemptions	$ 16,200	($4,050 *4)
	Taxable income	$54,450

	Note:
	Since their itemized deduction i.e.$8,000 is less than standard deduction i.e.$9,350. it is beneficial to take standard deduction

c	AGI	$75,000
	Less: standard deduction (Surviving spouse)	$ 12,700
	Less: personal and dependency exemptions	$ 12,150	($4,050 *3)
	Taxable income	$50,150

	Note:
	Since their itemized deduction i.e.$10,100 is less than standard deduction i.e.$12,700. it is beneficial to take standard deduction

d	AGI	$58,000
	Less: itemized deductions	$ 9,500
	Less: personal and dependency exemptions	$ 16,200	($4,050 *4)
	Taxable income	$32,300

	Note:
	Since their itemized deduction i.e.$9,500 is more than standard deduction. it is beneficial to take standard deduction

e	AGI	$64,000
	Less: itemized deductions	$ 9,900
	Less: personal and dependency exemptions	$ 8,100	($4,050 *2)
	Taxable income	$46,000

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