Taylor, age 15, is claimed as a dependent by her parents. For 2016, she records the following income: $4,600 wages from a summer job, $1,755 interest from a money market account, and $1,875 interest from City of Boston bonds. If required, round your answers to the nearest dollar. If an amount is zero, enter "0".

1. Taylor's standard deduction for 2016 is $

2. Taylor's personal exemption for 2016 is $

3. Taylor's taxable income for 2016 is $

4. Compute Taylor's "net unearned income" for the purpose of the kiddie tax. $5. Assume that Taylor's tax rate is 10% and her parents' tax rate is 28%. If Taylor's parents file a joint return and report taxable income of $130,000, then Taylor's tax is $.

Homework #1: Manual Submission Questions 1. A, an individual, found $5,000 cash on the street and gifted it to his friend B who was broke and really need the money. As a result of this transaction: a. A will report $5,000 income on A's personal income tax return b. A will not report any income on A's personal income tax return c. B will report $5,000 income on B's personal income tax return; d. A will report $5,000 income, but also have a $5,000 deduction; e. A will report $5,000 income, and would also get a deduction (the amount determined with reference to A's AGI) If A gave the money to a qualified charity, instead of giving it to B. f. Both a and e are correct 2. Taylor, age 15, is claimed as a dependent by her parents. For 2016, she records the following income: $4,600 wages from a summer job, $1,755 interest from a money market account, and $1,875 interest from City of Boston bonds. If required, round your answers to the nearest dollar. If an amount is zero, enter "0". a. Taylor's standard deduction for 2016 is $ b. Taylor's personal exemption for 2016 is $ c. Taylor's taxable income for 2016 is $ d. Compute Taylor's "net unearned income" for the purpose of the kiddie tax. $ Assume that Taylor's tax rate is 10% and her parents' tax rate is 28%. If Taylor's parents file a joint return and report taxable income of $130,000, then Taylor's tax is $ . 3. True or False. Nonbusiness expenses are expenses incurred in connection with an income-producing activity that does not qualify as a trade or business. Such expenses are deductions for adjusted gross income. 4. True or False. In lieu of claiming itemized deductions, taxpayers will use the standard deduction. 5. True or False. The standard deduction is the sum of two components: the basic standard deduction and the additional standard deduction. 6. True or False. Certain taxpayers are not allowed to claim any standard deduction, and the standard deduction is limited for others. 7. True or False. In order to claim a dependency exemption, the taxpayer must furnish over one-half of the support for claimed dependent during the year. 8. During the year, Tamara had capital transactions resulting in gains (losses) as follows: Sold stock in ABC Company (acquired two years ago) ($1,500) Sold collectible coins (held for more than one year) Sold stock in XYZ Company (acquired six months ago) ($4,100) Sold stock in LMN Company (acquired three years ago) $500 $2,000 a. As a result of these transactions, Tamara has an overall net of $ . b. Is the amount of her overall net gain or loss limited this year? c. If "Yes", what is the limit. If "No", enter"0". $ 9. True or False. If individual A's tax on taxable income is $100,000, and A has a tax credit in the amount of $10,000, A's AGI will be decreased when the tax credit is applied. 10. Use the tax rate schedules (can be found on-line including at www.irs.gov or in the textbook) to compute the 2015 tax liability for Charlotte. Charlotte (age40) is a surviving spouse and provides all of the support for her four minor children, who live with her. Charlotte also maintains the household in which her parents live, and she furnished 60% of their support. Besides interest on City muni bondsin the amount of $5,500, Charlotte's father received $2,400 from a part-time job. Charlotte earns an $80,000 salary a short term capital loss of $2,000, and a cash prize of $4,000 (she was a contestant on the Price is Right). Charlotte reports itemized deductions of $10,500