Taxpayer Marlene is single and $29$ years old. She earns a salary of $$45,000$ for her work as a librarian. Her employer does not offer a retirement plan so she saves for her retirement with a Roth IRA. She contributes the maximum allowed every year. Her employer withheld $$4,000$ in federal income taxes and $$2,500$ in state income taxes during the year and prepaid them on Marlene$$s behalf.

Her employer pays for her health insurance and the plan is considered a high deductible plan. She has a health savings account $($HSA$)$ and has $$100$ per month deposited directly into her HSA, pre$-$tax. Additionally, her employer contributes $$500$ per year to her HSA. Marlene did not withdrawal any money from her HSA during the year.

Marlene is well$-$known in her town for her knowledge about birds and occasionally speaks to small groups of people and leads birding walks. She received payments of $$4,000$ during the year for a variety of classes and walks. These payments are considered self$-$employment income and she has $$400$ of qualified expenses connected to this work.

Marlene made her final student loan payment during the year and received a document stating that she had paid $$530$ of interest on her student loan during the year.

In previous years, Marlene has always used the standard deduction. In $2023,$ Marlene bought a house and wonders if some of those expenses qualify for the itemized deduction. She borrowed $$170,000$ and paid $$4,850$ in interest on her mortgage during the year. Since she only owned the home for part of the year, she hasn$$t paid any real estate taxes yet.

Marlene has severe allergies and, at the recommendation of her doctor, installed a central air conditioning system that cost $$4,500.$ Having central air conditioning increased the value of her home by $$2,500.$ She also paid $$800$ for prescription allergy medication during the year. In October she paid $$25$ to get a flu shot.

During the year, Marlene contributed the following to a variety of qualified charities and has the required receipts and documentation to support her giving:

$$1,000$ to her church $($credit card payments$)$

$$500$ to the college where she graduated

Stock she purchased $3$ years ago. The value of the stock when she donated it was $$6,000.$ Her cost was $$2,000.$

A variety of furniture, used clothing and other household items to Goodwill. Marlene estimates the value to be $$650.$

Marlene is on the board of a qualified charity and travels monthly to board meetings $(12$ meetings during $2023).$ She drove a total of $360$ miles to$/$from these board meetings in $2023.$ She does not get paid for her service on the board and is considered a volunteer of the organization.

Marlene also gave $$500$ to each of her three nephews to help them pay for their college textbooks.

Provide answers for each of the following components of Marlene$$s tax situation and show calculations to support your numerical answers:

Compute Marlene$$s gross income for $2023.$ If you excluded any of her income from your calculation, explain why.

Compute Marlene$$s adjusted gross income, explaining what adjustments you included to get from gross income to adjusted gross income.

Should Marlene choose the standard deduction or itemized deduction? Be specific about each of the deductions that can be part of itemized deductions.

Which of Marlene$$s expenses are not deductible for tax purposes?

Compute Marlene$$s taxable income for $2023.$