Question
Please help explain in detail how to get the gross tax liability. I need to understand where the numbers come from. Warren files as a
Please help explain in detail how to get the gross tax liability. I need to understand where the numbers come from.
Warren files as a head of household and is 60 years old during 2019. He provides all of the support for his elderly mother who lives in a nearby nursing home and his mother qualifies as his dependent in 2019. Warren has the following tax information for 2019: - Salary Income .....................................................................................$195,000 - Interest income ......................................................................................... 3,000 - Short-term capital gain .............................................................................. 5,000 - Medical expenses paid for Warren and his mother before the AGI floor ..... 24,300 - State income taxes paid ............................................................................. 9,000 - Property tax paid on residence ................................................................... 7,800 - Mortgage interest paid on residence ......................................................... 12,000 - Interest paid on home equity loan taken out in 2019 to buy a new car ........... 2,800 - Cash contributions to university................................................................. 3,000 - Unreimbursed employee expenses ............................................................. 5,600 - Personal tax return preparation expense...................................................... 1,800 - Casualty loss after $100 floor due to uninsured theft of car ........................ 22,000 Compute Warrens 2019 taxable income and the amount of tax he still owes or the refund that is due to him after any allowable tax credits and withholding/prepayments of $37,500 that Warren has made in 2019. Ignore any net investment income tax.
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