Cynthia and John have dependent twins ages 24. Their joint income places them in the 35 percent marginal tax bracket. What are their total tax savings if they can transfer $7,500 of taxable income to each of the children? The children have no other taxable income.

Question

Quizplus · Accepted Answer

The Answer is Children's tax: ($7,500 - $950 standard deduction) x .10 x 2 = $1,310; Parents' tax savings: $15,000 x .35 = $5,250. Net tax savings = $5,250 - $1,310 = $3,940

Cynthia and John Have Dependent Twins Ages 24