Problem 3-40 (LO. 1, 2, 3, 4, 5, 6) Morgan (age 45) is single and provides more than 50% of the support of Tammy (a family friend), Jen (a niece, age 18), and Jerold (a nephew, age 18). Both Tammy and Jen live with Morgan, but Jerold (a French citizen) lives in Canada. Morgan earns a salary of $96,000, contributes $6,000 to a traditional IRA, and receives sales proceeds of $15,000 for an RV that cost $60,000 and was used for vacations. She has $8,200 in itemized deductions. Click here to access the standard deduction table to use if required. a. Morgan's taxable income is $ b. Using the Tax Rate Schedules (click here), tax liability for Morgan is $ for 2021. C. Compute Morgan's dependent tax credit. care 3-2a Basic and Additional Standard Deduction * The standard deduction is the sum of two components: the basic standard deduction and the additional standard deduction. Exhibit 3.4 lists the basic standard deduction allowed for taxpayers in each filing status. Certain taxpayers, however, are not allowed to claim any standard deduction, and the standard deduction is limited for others. Exhibit 3.4 Basic Standard Deduction Amounts Standard Deduction Amount Filing Status 2020 2021 Single $12,400 $12,550 Married, filing jointly 24,800 25,100 Surviving spouse 24,800 25,100 Head of household 18,650 18,800 Married, filing separately 12,400 12,550 2021 Tax Rate Schedules SingleSchedule X If taxable income is: But not Over- over- of the amount over- of the amount over The tax is: $ 0 $ 9,950 ......... 10% $ 0 $ 0 14,200 Head of householdSchedule Z If taxable income is: But not Over- over- The tax is: $ 0 $ 14,200 .........10% 14,200 54,200 $ 1,420.00 + 12% 54,200 86,350 6,220.00 + 22% 86,350 164,900 13,293.00 + 24% 164,900 209,400 32,145.00 + 32% 209,400 523,600 46,385.00 + 35% 523,600 156,355.00 + 37% Married filing separatelySchedule Y-2 54,200 86,350 164,900 209,400 523,600 9,950 40,525 $ 995.00 + 12% 9,950 40,525 86,375 4,664.00 + 22% 40,525 86,375 164,925 14,751.00 + 24% 86,375 164,925 209,425 33,603.00 + 32% 164,925 209,425 523,600 47,843.00 + 35% 209,425 523,600 157,804.25 + 37% 523,600 Married filing jointly or Qualifying widow(er) - Schedule Y-1 If taxable of the income is: But not amount Over- over- The tax is: over- $ 0 $ 19,900 . 10% $ 0 19,900 81,050 $ 1,990.00 + 12% 19,900 81,050 172,750 9,328.00 + 22% 81,050 172,750 329,850 29,502.00 + 24% 172,750 If taxable income is: Over- of the amount over- The tax is: But not over- $ 9,950 40,525 $ 0 ........ 10% $ 0 9,950 $ 995.00 + 12% 9,950 40,525 40,525 86,375 4,664.00 + 22% 14,751.00 + 24% 86,375 164,925 86,375 DUE TOT ome is: Over- DUL NOL over- The tax is: amount over- amount over- :::..... 10% $ 0 9,950 14,200 54,200 come is: Over- over- The tax is: $ 0 $ 14,200 .........10% 14,200 54,200 $ 1,420.00 + 12% 54,200 86,350 6,220.00 + 22% 86,350 164,900 13,293.00 + 24% 164,900 209,400 32,145.00 + 32% 209,400 523,600 46,385.00 + 35% 523,600 156,355.00 + 37% Married filing separatelySchedule Y-2 86,350 164,900 209,400 523,600 $ 0 $ 9,950 $ 0 40,525 $ 995.00 + 12% 9,950 40,525 86,375 4,664.00 + 22% 40,525 86,375 164,925 14,751.00 + 24% 86,375 164,925 209,425 33,603.00 + 32% 164,925 209,425 523,600 47,843.00 + 35% 209,425 523,600 157,804.25 + 37% 523,600 Married filing jointly or Qualifying widow(er)- Schedule Y-1 If taxable of the income is: But not amount Over- over- The tax is: over- $ 0 $ 19,900 $ 0 19,900 81,050 $ 1,990.00 + 12% 19,900 81,050 172,750 9,328.00 + 22% 81,050 172,750 329,850 29,502.00 + 24% 172,750 329,850 418,850 67,206.00 + 32% 329,850 418,850 628,300 95,686.00 + 35% 418,850 628,300 168,993.50 + 37% 628,300 If taxable income is: Over- of the amount But not over- The tax is: over- .........10% $ 0 $ 9,950 ......... 10% $ 0 9,950 40,525 $ 995.00 + 12% 9,950 40,525 86,375 4,664.00 + 22% 40,525 14,751.00 + 24% 86,375 86,375 164,925 209,425 164,925 209,425 33,603.00 + 32% 47,843.00 + 35% 314,150 164,925 209,425 314,150 314,150 84,496.75 + 37%