Linda and Don are married and file a joint return. In 2015, they received $12,000 in Social Security benefits and $35,000 in taxable pension benefits and interest. The applicable two bases for Social Security computations for married filing jointly are $32,000 and $44,000.

a. The couple's adjusted gross income on a joint return is?

b. Don would like to know whether they should sell for $100,000 (at no gain or loss) a corporate bond that pays 8% in interest each year and use the proceeds to buy a $100,000 nontaxable State of Virginia bond that will pay $6,000 in interest each year.

With a 15% marginal tax rate, their after-tax economic income will increase or decease by how much?

c. In the preceding situation (a), if Linda works part-time and earns $30,000, by how much would Linda and Don's adjusted gross income increase?