Ayla, age 17, is claimed by her parents as a dependent. During 2018, she had interest income from a bank savings account of $2,000 and income from a part-time job of $4,200. Ayla's taxable income is:
A) $4,200 - $4,550 = $0.
B) $6,200 - $5,700 = $500.
C) $6,200 - $4,550 = $1,650.
D) $6,200 - $1,000 = $5,200.
E) None of these.

Question

Quizplus · Accepted Answer

Ayla's taxable income is calculated by subtracting her standard deduction ($12,000 for 2018) from her total income. However, since she is claimed as a dependent by her parents, she cannot claim her own personal exemption. Therefore, her taxable income is:

$2,000 (interest income) + $4,200 (part-time job income) - $4,550 (standard deduction for dependents) = $1,650.

Option A is incorrect because Ayla's taxable income cannot be negative. Option B is incorrect because it does not account for Ayla's standard deduction. Option D is incorrect because it subtracts $1,000 from Ayla's total income, but it is not clear where this $1,000 comes from. Option E is incorrect because there is a correct answer among the given choices.

Ayla, Age 17, Is Claimed by Her Parents as a Dependent