Jeremy earned $250,000 in salary and $10,000 in interest income during the year. Jeremy has two qualifying dependent children who live with him. He qualifies to file as head of household and has $20,000 in itemized deductions. Neither of his dependents qualifies for the child tax credit. (use the tax rate schedules.). (Do not round intermediate calculations. Round "Income tax liability" to 2 decimal places.)

a. Use the 2016 tax rate schedules to determine Jeremys taxes due.

b. Assume that in addition to the original facts, Jeremy has a long-term capital gain of $12,000. What is Jeremys tax liability including the tax on the capital gain?

c. Assume the original facts except that Jeremy had only $3,500 in itemized deductions. What is Jeremys total income tax liability?

2016 Federal Tax Rate Schedule Schedule X-Single Schedule Z-Head of Household If taxable If taxable income is But not income is But not The tax is The tax is: over: Over Over Over 0 9,275 10% of taxable income 0 13,250 10% of taxable income 9,275 37650 $92750 plus 15% of the excess 13,250 50,400 $1,325.00 plus 15% of the excess over $9,275 over $13,250 37650 91,150 $5,183.75 plus 25% of the excess 50,400 $130,150 $6.89750 plus 25% of the excess over $37650 over $50,400 $130,150 $210,800 $26,835.00 plus 28% of the excess 91,150 $190,150 $18,558.75 plus 28% of the excess over $130,150 over $91,150 $190,150 $413,350 $46,278.75 plus 33% of the excess $210,800 $413,350 $49,41700 plus 33% of the excess over $210,800 over $190,150 $413,350 $415,050 $119,934.75 plus 35% of the excess $413,350 $441,000 $116,258.50 plus 35% of the excess over $413,350 over $413,350 $415,050 $120,529.75 plus 39.6% of the excess $441,000 $125,936.00 plus 39.6% of the excess over $415,050 over $441,000 Schedule Y 1- Married Filing Jointly Schedule Y 2- Married Filing Separately of Qualifying Widow(er) If taxable income is But not If taxable income is But not The tax is: Over Over The tax is: Over Over 0 9,275 10% of taxable income 9,275 37650 $92750 plus 15% of the excess 0 18,550 10% of taxable income Over $9,275 18,550 75,300 $1,855.00 plus 15% of the excess 37650 75,950 $5,183.75 plus 25% of the excess over $18,550 75,300 $151,900 $10,36750 plus 25% of the excess over $37650 over $75,300 75,950 $115,725 $14,758.75 plus 28% of the excess $151,900 $231,450 $29,51750 plus 28% of the excess over $75,950 over $151,900 $115,725 $206,675 $25,895.75 plus 33% of the excess over $115,725 $231,450 $413,350 $51,791.50 plus 33% of the excess over $231,450 $206,675 $233,475 $55,909.25 plus 35% of the excess over $206,675 $413,350 $466,950 $111,818.50 plus 35% of the excess over $413,350 $233,475 $65,289.25 plus 39.6% of the excess over $233,475 $466,950 $130,578.50 plus 39.6% of the excess over $466,950