LO.2, 3, 4, 5 Larry is single and has the following items for 2012:

Income—

Salary $145,000 Interest from bank savings account 12,000 Interest on corporate bonds 7,000 Short-term capital gain 8,000 Expenses—
Unreimbursed employee business expenses (no meals or entertainment) $ 4,000 Total medical expenses 24,000 State income taxes 6,500 Real property taxes 6,800 Home mortgage (qualified housing) interest 7,200 Casualty loss on vacation home—
Decline in value 20,000 Adjusted basis 70,000 Insurance proceeds 12,000 Tax preferences 116,000 Compute Larry’s tax liability for 2012 before credits or prepayments.