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Lance and Danielle are cash-method, calendar-year taxpayers who file a joint return for 2017. They do not have any dependents at any time during 2017

Lance and Danielle are cash-method, calendar-year taxpayers who file a joint return for 2017. They do not have any dependents at any time during 2017 and have timely filed a joint return for each year of their marriage. The following are items that Lance and Danielle received in 2017:

Income Item Amount
Lance's Social Security benefits $7,000
Danielle's Social Security benefits 2,000
Interest on federal income tax refund 600
Interest on state government obligations 1,000

The $750 dividend on stock is held in a public corporation that offers a dividend reinvestment program in which Lance and Danielle participate. The dividend reinvestment program allows participants to use dividends to buy more stock in the corporation at a price less than its fair market value. The fair market value of shares that Lance and Danielle received through the plan on the dividend payment date was $1,000.

Calculate the following income items using the information above and exhibits.

For each item, enter the appropriate amounts in the associated cells. If the amount is zero, enter a zero (0). Round all amounts to the nearest whole dollar.

Income Item Amount
1. What is the amount of Lance and Danielle's taxable Social Security benefits for 2017?
2. What amount of interest income is taxable on Lance and Danielle's 2017 joint income tax return?
3. What amount of dividend income should Lance and Danielle report on their 2017 joint income tax return?
4. What is the total amount of gross income that must be reported on Lance and Danielle's 2017 joint income tax return?

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