Question
In 2021, Mason, age 35 and single, earned wages of $76,000. Mason had exclusions of $1,000, and he had adjustments of $1,000. Masons itemized deductions
In 2021, Mason, age 35 and single, earned wages of $76,000. Mason had exclusions of $1,000, and he had adjustments of $1,000. Masons itemized deductions for the year totaled $12,000. Mason is not entitled to any qualified business income deduction. Mason's employer withheld federal income taxes of $5,000 from Mason's paychecks, and Mason is also entitled to an additional $2,500 tax credit. What is Mason's gross income? What is Mason's adjusted gross income? What is Mason's taxable income? Using the 2021 tax rate schedules, what is Mason's tax liability (before credits and withholdings)? Using the tax tables, what is Mason's tax liability (before credits and withholdings)? Which option does Mason use? How do the withholding and tax credits impact Mason's tax liability?
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