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Reba Dixon is a fifth-grade school teacher who earned a salary of $38,300 in 2018. She is 45 years old and has been divorced for

Reba Dixon is a fifth-grade school teacher who earned a salary of $38,300 in 2018. She is 45 years old and has been divorced for four years. She receives $1,290 of alimony payments each month from her former husband (divorced in 2016). Reba also rents out a small apartment building. This year Reba received $50,400 of rental payments from tenants and she incurred $19,656 of expenses associated with the rental. Reba and her daughter Heather (20 years old at the end of the year) moved to Georgia in January of this year. Reba provides more than one-half of Heathers support. They had been living in Colorado for the past 15 years, but ever since her divorce, Reba has been wanting to move back to Georgia to be closer to her family. Luckily, last December, a teaching position opened up and Reba and Heather decided to make the move. Reba paid a moving company $2,190 to move their personal belongings, and she and Heather spent two days driving the 1,462 miles to Georgia. Reba rented a home in Georgia. Heather decided to continue living at home with her mom, but she started attending school full-time in January at a nearby university. She was awarded a $3,180 partial tuition scholarship this year, and Reba helped out by paying the remaining $500 tuition cost. If possible, Reba thought it would be best to claim the education credit for these expenses. Reba wasn't sure if she would have enough items to help her benefit from itemizing on her tax return. However, she kept track of several expenses this year that she thought might qualify if she was able to itemize. Reba paid $5,980 in state income taxes and $12,680 in charitable contributions during the year. She also paid the following medical-related expenses for herself and Heather:

Insurance premiums $ 5,975
Medical care expenses $ 1,280
Prescription medicine $ 530
Nonprescription medicine $ 280
New contact lenses for Heather $ 380

Shortly after the move, Reba got distracted while driving and she ran into a street sign. The accident caused $1,080 in damage to the car and gave her whiplash. Because the repairs were less than her insurance deductible, she paid the entire cost of the repairs. Reba wasnt able to work for two months after the accident. Fortunately, she received $2,180 from her disability insurance. Her employer, the Central Georgia School District, paid 60% of the premiums on the policy as a nontaxable fringe benefit and Reba paid the remaining 40% portion. A few years ago, Reba acquired several investments with her portion of the divorce settlement. This year she reported the following income from her investments: $2,380 of interest income from corporate bonds and $1,680 interest income from the City of Denver municipal bonds. Overall, Rebas stock portfolio appreciated by $12,180 but she did not sell any of her stocks. Heather reported $6,560 of interest income from corporate bonds she received as gifts from her father over the last several years. This was Heathers only source of income for the year. Reba had $10,000 of federal income taxes withheld by her employer. Heather made $1,000 of estimated tax payments during the year. Reba did not make any estimated payments. Reba had qualifying insurance for purposes of the Affordable Care Act (ACA).

A. Determine Rebas federal income tax refund or taxes payable for the current year.

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2018 Tax Rate Schedules Schedule X-Single Schodule ZHead of Homaehold Ir tarable income is over But not over: The tax i If taxable income is over: But not over: S 13,600 51,800 $ 82,500 $157,300 The tax b 9,525 $ 38,700 82,500 $157,500 $200,000 $500,000 10% of taxable income 10% of taxable insom $1.360 plus 12% of the excess over S13.600 $5,944 plus 22% of the eroa" over $51,000 $12.093 plas 24% of the excess over $82.500 $30,096 plus 32% ofthe excess over $157,500 $44,296 pla 35% of the over S200000 $149293 plus 37% of the excess over $500,000 9952.50 plus 12% of the excess over $9,525 5 9525 $ 38,700 5 82.500 $157.500 200,000 453.50 plus 22% of the eme" over $38,700 S 14,089.50 plus 24% of te ence" over S82.500 32,009.50 plus 32% of the evoess over $157,500 45,689.50 plus 35% of the enats over $200,000 $150,609.50 plus 37% of the eness over $500,000 $ 13,600 51,800 5 82,500 $157.500 $200,000 $300,000 Schedule Y-1-Married Filing Jointty or Qualtying Widoe (er) Schedulo Y-2-Married Filing Separately If tatable income is over The tax is But not over: 19,050 s 77,400 $165,000 $315,000 $400,000 If taxable income is over: But not over $ 9525 S 38.700 82,500 $157,500 The tax is 19.030 $ 77400 $165,000 $315,000 $400,000 $600,000 10% of truble income $1,905 plus 12% ofthe excess over $19.030 sa-907 plus 22% ofthe excess over $77,400 $2 179 plus 24% ofthe greess over $165,000 S4.179 plus 32% ofthe excess over $315,000 $91,579 plus 35% ofthe greats oor $400,000 $161.379 plus 37% of the excess over 3000,000 5 9.525 $ 38,700 $ 82.500 $157,500 10% of tutable income 5952.50plas12% of the excess owers,525 $4,453.50 plus 22%ofthe et cess over$38,700 $14,089 50 plus 24% of the arcess ow SS2500 $32,009.50 plus 32% ofthe excess over $157,500 $45,6G9.50 plus 35% ofta "cess one S200000 580589.50 plus 37%ofthe escess over $300,000 5300,000 $300,000 Description Amount Gross Income: Salary Alimony received Rental receipts Disability insurance payments Interest income from corporate bonds Interest income from municipal bonds $38,300 15,480 50,400 1,308 2,380 0 $ 107,868 (1) Gross income Deductions for AGI Expenses for rental property (2) Total for AGI deductions (3) AGI 19,656 22,109 $85,759 From AGI deductions Medical expenses State income taxes Charitable contributions (4) Total itemized deductions (5) Standard deduction (6) Greater of itemized deductions or standard deduction (7) Taxable income (8) Tax on taxable income (9) Credits (10) Tax prepayments 0 5,980 12,680 18,660 18,000 18,660 67,099 9,310 1,000 10,000 1,690 S ax refund

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