Question
Tax Question, can somebody please check my work? Problem: In 2020, Adam, your brother in law, has the following items below. Adam is not sure
Tax Question, can somebody please check my work?
Problem:
In 2020, Adam, your brother in law, has the following items below. Adam is not sure how much tax refund that he will receive so he asks you, an accounting student to help him with estimating his tax refund. Use the tax calculation spreadsheet to help Adam figure out his refund for 2020.
- Salary: $70k
- Income from his Airbnb rental: $10k
- Tax withheld in 2020 (Prepayment): $15,400
- Adam has a total itemized deduction of $200 (from his Goodwills donation)
Adam is married and has 1 child who is qualified for a $2000 child tax credit. Adams wife (your sister) is a stay-at-home mom and does not have any source of income in 2020.
My work:
Since Adam is married, he would file as married filing jointly right? Then all I did was get the tax rate, added prepayment, child tax credit, the itemized deduction, and the standard deduction from either the problem or the following table:
So is this right? Should Adam expect a $10,776 refund? Or am I missing something here?
80,000 80,000 24,800 24,800 200 Gross Income $ (-) Adjustments (Above the Line deductions) Adjusted Gross Income (AGI) $ (-) From AGI deduction: $ Greater of (a) Standard deduction OR $ (b) Itemized deduction $ Deduction for Qual. Business Income (x) Taxable Income $ Tax rate (-) Income tax liability (-) Credit Prepayment $ Tax due or (Tax refund) $ 55,200 0.12 6,624 2,000 15,400 (10,776) 2020 Fed Income Tax Bracket (Source: Nerd Wallet) Tax rate Single Married, filing jointly Married, filing separately 10% $0 to $9,875 $0 to $19,750 $0 to $9,875 12% $9,876 to $40,125 $19,751 to $80,250 $9,876 to $40,125 22% $40,126 to $85,525 $80,251 to $171,050 $40,126 to $85,525 24% $85,526 to $163,300 $171,051 to $326,600 $85,526 to $163,300 32% $163,301 to $207,350 $326,601 to $414,700 $163,301 to $207,350 35% $207,351 to $518,400 $414,701 to $622,050 $207,351 to $311,025 37% $518,401 or more $622,051 or more $311,026 or more Head of household $0 to $14,100 $14,101 to $53,700 $53,701 to $85,500 $85,501 to $163,300 $163,301 to $207,350 $207,351 to $518,400 $518,401 or more * 2020 Standard Deduction Filing Status Deduction Amount Single Married Filing Jointly Head of Household 30000 50000 80000 20000 $12,400 $24,800 $18,650 2020 Child Tax Credit $2000/child
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