Question
1. Brendan and Theresa are married and have three children in college. Their twin daughters, Christine and Katlyn, are freshmen and attend the same university.
1. Brendan and Theresa are married and have three children in college. Their twin daughters, Christine and Katlyn, are freshmen and attend the same university. Their son, Kevin, is a graduate student. Brendan and Theresa pay $12,000 in tuition and fees ($6,000 each) and $1,100 in textbooks ($500 and $600 respectively) for their daughters and $4,200 in tuition and fees for Kevin and $400 in textbooks. The twins room and board is $2,600, while Kevin's room and board is $1,400. Brendan and Theresa have an adjusted gross income of $77,000.
a. What amount can they claim as a tax credit for the higher education expenses they pay?
b. Assume that their adjusted gross income is $116,000. What amount can they claim as a tax credit for the higher education expenses they pay?
c. Assume the same facts as in part a, except that Kevin is a freshman and the twins are graduate students. What amount can Brendan and Theresa claim as a tax credit for the higher education expenses they pay?
2. Determine whether each of the following taxpayers must file a return in 2016:
a. Felicia is a dependent who has wages of $6,100 and interest income of $225.
b. Jason is a dependent who has interest income of $800.
c. Jerry is self-employed. His gross business receipts are $43,000, and business expenses are $40,300. His only other income is $1,200 in interest from municipal bonds
3. Martina is single and has two children in college. Matthew is a sophomore and Christine is in her fifth year of college. Martina pays $3,600 in tuition and fees for Matthew, $700 for textbooks, and $2,000 for his room and board. Christine's tuition and fees are $4,800, her textbooks are $550, and her room and board expenses are $1,800. Martina's adjusted gross income is $55,000.
a. What amount can Martina claim as a tax credit for the higher education expenses she pays?
b. Assume that Martina's adjusted gross income is $83,000. What amount can she claim as a tax credit for the higher education expenses she pays?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started