Question
Paul is 66 years old and Tina is 62 years old. In 2020, they file a joint return.They support their 22-year-old son, Jed, who is
Paul is 66 years old and Tina is 62 years old. In 2020, they file a joint return.They support their 22-year-old son, Jed, who is a full-time student.He earns $4,000.00 per year as a waiter at a restaurant.
Wages............................................................... $ 170,000.00
Interest from savings.......................................... $12,000.00
Interest on NYS qualified bonds........................... $7,000.00
Inheritance from Tina's Aunt Lucy....................... $6,000.00
Child support from Tina's ex-husband Eric........ $10,000.00
Prize from contest at church.................................. $1,000.00
Paul and Tina own a house in Whitestone.The costs associated with the house were as follows:
Mortgage interest$7,000.00
(Please note:The amount of the indebtedness is under $750,000.00.)
Real estate taxes$8,000.00
They paid hospital bills of $7,000.00 and doctor's bills of $6,000.00.Their medical insurance company reimbursed them in the amount of $3,000.00 for the doctor's bills.They had prescriptions in the amount of $500.00 and a yearly vitamin expense of $200.00.
Their charitable contributions included:
$2,000.00 paid to St. Mary's Church
$500.00 paid to Mr. and Mrs. Elm (neighbors) whose house was damaged in a flood
a)What is Paul and Tina's gross income?
b)What is Paul's and Tina's adjusted gross income ?
c)What is Paul and Tina's standard deduction without regard to their itemized deductions?
d)What is Paul and Tina's net itemized deduction ?
e)How much of the charitable donations are deductible?
f)What is Paul and Tina's taxable income?
g)What is Paul and Tina's tax liability?
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