Please answer question in Document. You can see question better if you look at it in the attached document.

Problem 1
Davenports	Thompsons
Salary ( earned by one spouse)	$36,000	$95,000
Interest	1,600	10,300
Deductible IRA contribution	2,500	0
Itemized deductions	17,000	17,000
Expemptions	7,900	7,900
WithHolding	900	20,500
Compute the 2015 tax due or refund for each couple. Assume that the itemized deductions have been
reduced by the applicable floors Ignore credits.
A. Compute Taxable Income:
Davenports	Thompsons
Salary
add interest
Gross income
Minus:
Ira Contributions
Adjusted Gross Income
Minus:
Itemized deductions
Exemptions
Taxable Income
B. Calculate the 2015 tax due or refund due for each couple (use a minus sign or parentheses for a net tax refund)
Davenports	Thompsons
Gross tax
Minus:
Withholding
Tax due (refund)	$

Reference
STANDARD DEDUCTION 2015
Filing Status
Married individuals filing joint returns and surviving spouses	$12,600
Heads of households	9,250
Unmarried individuals (other than surviving spouses and heads of households)	6,300
Married individuals filing separate returns	6,300
Additional standard deduction for the aged and the blind
Individual who is married and surviving spouses	1,250
Individual who is unmarried and not a surviving spouse	1,550 *
Taxpayer claimed as dependent on another taxpayer's return:
Greater of (1) earned income plus $350 or (2) $1,050
* These amounts are $2,500 and $3,100, respectively , for a taxpayer who is both aged and blind.
PERSONAL AND DEPENDENCY EXEMPTION AND PHASE-OUTS
Personal and dependency exemption Phase-outs for high income taxpayers :	4,000
Personal and dependency exemptions are reduced by 2% for each $2,500 increment (or part of increment) for AGI above the threshold amount.
Itemized deductions are reduced by 3% for each dollar of AGI above the threshold amounts (taxpayers cannot lose more than 80% of their allowable itemized deductions).
For both provisions , the AGI threshold amounts are:
Married individuals filing joint returns and surviving spouses	$305,050
Heads of households	$279,650
Unmarried individuals (other than surviving spouses and heads of households)	$254,200
Married individuals filing separate returns	$152,525

Married, Filing Joint and Surviving Spouse

If taxable income is: The tax is:

Not over $18,450. .................... 10% of taxable income.

Over $18,450 but not over $74,900. . .. .. . $1,845.00 + 15% of the excess over $18,450. Over $74,900 but not over $151,200...... $10,312.50 + 25% of the excess over $74,900. Over $151,200but not over $230,450. .... $29,387.50 + 28% of the excess over $151,200. Over $230,450but not over $411,500... .. $51,577.50 + 33% of the excess over $230,450. Over $411,500but not over $464,850. .... $111,324.00 + 35% of the excess over $411,500.

Over $464,850....................... $129,996.50 + 39.6% of the excess over $464,850.

Problem 1 Davenports Thompsons Salary ( earned by one spouse) $36,000 $95,000 Interest 1,600 10,300 Deductible IRA contribution 2,500 0 Itemized deductions 17,000 17,000 Expemptions 7,900 7,900 WithHolding 900 20,500 Compute the 2015 tax due or refund for each couple. Assume that the itemized deductions have been reduced by the applicable floors Ignore credits. A. Compute Taxable Income: Davenports Thompsons Salary add interest Gross income Minus: Ira Contributions Adjusted Gross Income Minus: Itemized deductions Exemptions Taxable Income B. Calculate the 2015 tax due or refund due for each couple (use a minus sign or parentheses for a net tax refund) Davenports Thompsons Gross tax Minus: Withholding Tax due (refund) $ Reference STANDARD DEDUCTION 2015 Filing Status Married individuals filing joint returns and surviving spouses Heads of households Unmarried individuals (other than surviving spouses and heads of households) Married individuals filing separate returns Additional standard deduction for the aged and the blind Individual who is married and surviving spouses Individual who is unmarried and not a surviving spouse Taxpayer claimed as dependent on another taxpayer's return: Greater of (1) earned income plus $350 or (2) $1,050 * These amounts are $2,500 and $3,100, respectively , for a taxpayer who is both aged and blind. PERSONAL AND DEPENDENCY EXEMPTION AND PHASE-OUTS Personal and dependency exemption Phase-outs for high income taxpayers : Personal and dependency exemptions are reduced by 2% for each $2,500 increment (or part of increment) for AGI ab Itemized deductions are reduced by 3% for each dollar of AGI above the threshold amounts (taxpayers cannot lose m For both provisions , the AGI threshold amounts are: Married individuals filing joint returns and surviving spouses Heads of households Unmarried individuals (other than surviving spouses and heads of households) Married individuals filing separate returns Married, Filing Joint and Surviving Spouse If taxable income is: The tax is: Not over $18,450. .................... 10% of taxable income. Over $18,450 but not over $74,900. . .. .. . $1,845.00 + 15% of the excess over $18,450. Over $74,900 but not over $151,200...... $10,312.50 + 25% of the excess over $74,900. Over $151,200but not over $230,450. .... $29,387.50 + 28% of the excess over $151,200. Over $230,450but not over $411,500... .. $51,577.50 + 33% of the excess over $230,450. Over $411,500but not over $464,850. .... $111,324.00 + 35% of the excess over $411,500. Over $464,850....................... $129,996.50 + 39.6% of the excess over $464,850