Mike and Mindy have two children,Sarah and Jake.Sarah has interest and dividend income of $2,200.Jake has interest and dividend income of $750.For 2011,Mike and Mindy have taxable income of $76,000 which puts them in the 25 percent federal tax bracket.If each child files his/her own tax return,what is Sarah and Jake's tax liability?

Question

Quizplus · Accepted Answer

Sarah's interest and dividend income of $2,200 is below the standard deduction of $2,350 for single taxpayers in 2011, so she would not owe any federal income tax. 
Jake's interest and dividend income of $750 is also below the standard deduction, so he would not owe any federal income tax. Therefore, their tax liability is $0 each.

Mike and Mindy Have Two Children,Sarah and Jake