Problem 1-7 The Tax Formula for Individuals, Filing Status and Tax Computation (LO 1.3, 1.5, 1.6, 1.7) Ulysses and Penelope are married and file separate returns for 2016. Penelope itemizes her deductions on her return. Ulysses' adjusted gross income was $17,400, his itemized deductions were $2,250, and he is entitled to one exemption. Click here to access the tax tables Calculate Ulysses' income tax liability assuming the couple does not live in a community property state