Julian Thomas, who is single, goes to graduate school part-time and works as a waiter at the Bay Grill in San Francisco. During 2018, his gross income was $22,300 in wages and tips. He has decided to prepare his own tax return because he cannot afford the services of a tax expert. After preparing his return, he comes to you for advice. Here's a summary of the figures he has prepared thus far: Gross income: Wages $14,100 Tips +8,200 Adjusted gross income (AGI) $22,300 Less: Standard deduction $12,000 Taxable income $10,300 = Julian believes that if an individual's income falls below $23,000, the federal government considers him or her "poor and allows both itemized deductions and a standard deduction. He has found $2,300 in potential itemized deductions. 1. Calculate Julian Thomas' taxable income. Assume that the standard deduction for a single taxpayer is s12,000. Note that personal exemptions were suspended for 2018. $ 11000 x 2. Discuss Julian's errors in interpreting the tax laws, and explain the difference between itemized deductions and the standard deduction, The input in the box below will not be graded, but may be reviewed and considered by your instructor. One cannnot claim both deductions 3. Julian has been dating Elizabeth Moore for nearly 4 years, and they are seriously thinking about getting married. Elizabeth has income that is identical to Julian's. How much would they pay as a married couple (using the filing status of married filing jointly and a standard deduction of $24,000) versus the total amount the two would pay as single persons (each using the filing status of single)? Round the answers to the nearest cent. (Use Exhibit 3.3.) 2259 x Total tax liability (as a married couple filling jointly): $ Total tax liability (as single persons): $ 2259 x Strictly from a tax perspective, does it make any difference whether Julian and Joe stay single or get married? Explain. No The input in the box below will not be graded, but may be reviewed and considered by your instructor, no it does not make a difference EXHIBIT 3.3 2018 Tax Rate Schedules Single Taxable income Tax Rate $0-$9,525 10% of taxable income $9,526-$38,700 $952.50 plus 12% of the amount over $9,525 $38,701-$82,500 $4,453.50 plus 22% of the amount over $38,700 $82,501-$157,500 $14,089.50 plus 24% of the amount over $82,500 $157,501-$200,000 $32,089.50 plus 32% of the amount over $157,500 $45,689.50 plus 35% of the amount over $200,000 $200,001-S500,000 $500,001 or more $150,689.50 plus 37% of the amount over $500,000 Married filing jointly or Qualifying widow(er) Taxable income Tax Rate $0-$19,050 10% of taxable income $ 19,051-$77,400 $1,905 plus 12% of the amount over $19,050 $77,401-$ 165,000 $8,907 plus 22% of the amount over $77,400 $28,179 plus 24% of the amount over $165,000 $ 165,001-5315,000 $315,001-$400,000 $64,179 plus 32% of the amount over $315,000 $400,001-5600,000 $91,379 plus 35% of the amount over $400,000 $161,379 plus 37% of the amount over $600,000 $600,001 or more Married filing separately Taxable income Tax Rate $0-$9,525 10% of taxable income $9,526-$38,700 $952.50 plus 12% of the amount over $9,525 $4,453.50 plus 22% of the amount over $38,700 $38,701-$82,500 $82,501-$157,500 $14,089.50 plus 24% of the amount over $82,500 $157,501-$200,000 $32,089.50 plus 32% of the amount over $157,500 $200,001-$300,000 $45,689.50 plus 35% of the amount over $200,000 $300,001 or more $80,689.50 plus 37% of the amount over $300,000 Head of household Taxable income Tax Rate $0-$13,600 10% of taxable income $13,601-$51,800 $1,360 plus 12% of the amount over $13,600 $51,801-$82,500 $5,944 plus 22% of the amount over $51,800 $12,698 plus 24% of the amount over $82,500 $82,501-$157,500 $157,501-$200,000 $30,698 plus 32% of the amount over $157,500 $200,001-$500,000 $44,298 plus 35% of the amount over $200,000 $500,001 or more $149,298 plus 37% of the amount over $500,000