Find the tax in the following application problems. Use $4050 for each personal deduction, a standard deduction of $6300 for single taxpayers, $12,600 for married taxpayers filing jointly, $6300 for married taxpayers filing separately, and $9300 for head of household and the tax rate schedule.
-Glenn and Natalie Dowling had combined wages and salaries of $69,117, other income of $5,258, dividend income of $317, and interest income of $664. They have adjustments to income of $2,435. Their itemized deductions are $9,180 in mortgage interest, $1,611 in state income tax, $846 in real estate taxes, and $1,193 in charitable contributions. The Dowlings filed a joint return and claimed four exemptions.

Question

Find the tax in the following application problems. Use $4050 for each personal deduction, a standard deduction of $6300 for single taxpayers, $12,600 for married taxpayers filing jointly, $6300 for married taxpayers filing separately, and $9300 for head of household and the tax rate schedule. 
-Glenn and Natalie Dowling had combined wages and salaries of $69,117, other income of $5,258, dividend income of $317, and interest income of $664. They have adjustments to income of $2,435. Their itemized deductions are $9,180 in mortgage interest, $1,611 in state income tax, $846 in real estate taxes, and $1,193 in charitable contributions. The Dowlings filed a joint return and claimed four exemptions.

Quizplus · Accepted Answer

To calculate the Dowlings' taxable income, we first sum up all sources of income: wages and salaries ($69,117), other income ($5,258), dividend income ($317), and interest income ($664). This totals to $75,356. Then, we subtract the adjustments to income ($2,435), resulting in an adjusted gross income (AGI) of $72,921. Next, we calculate the total itemized deductions: mortgage interest ($9,180), state income tax ($1,611), real estate taxes ($846), and charitable contributions ($1,193), which sum to $12,830. Since the Dowlings are filing a joint return and claiming four exemptions, in 2020, the standard deduction for a married couple filing jointly was $24,800, but since their itemized deductions are less than the standard deduction, they would likely choose the standard deduction for a simpler calculation. However, without the standard or personal exemption amounts for the tax year in question (which are not provided and could vary by year), we proceed with the itemized deductions because they are specifically mentioned, suggesting their use in this scenario. Subtracting the itemized deductions ($12,830) from the AGI ($72,921) gives us their taxable income. However, without the specific exemption value per person or the tax brackets to calculate the exact tax, and given the choices provided seem to imply a final tax amount rather than taxable income, the correct answer cannot be directly calculated from the information given. The explanation provided is meant to outline the steps typically taken to calculate taxable income, but it seems there might be a misunderstanding in the question setup or a lack of necessary details to accurately select one of the provided choices based on standard tax calculation procedures.

Find the Tax in the Following Application Problems