Marie,an unmarried taxpayer,is 26 years old.This year,Marie earned $50,000 gross income.Her itemized deductions totaled $5,100.Marie maintained a home for her 12-year-old sister who qualifies as Marie's dependent.Compute Marie's taxable income.

Question

Quizplus · Accepted Answer

To calculate taxable income, we start with gross income and subtract either the standard deduction or itemized deductions, whichever is higher. In this case, Marie's itemized deductions ($5,100) are higher than the standard deduction, so we will use those.

Gross income = $50,000
Itemized deductions = $5,100
Adjusted gross income = $44,900 ($50,000 - $5,100)

Marie can claim her sister as a dependent, which will give her an additional exemption of $4,050.

Taxable income = adjusted gross income - personal exemption
Taxable income = $44,900 - $4,050
Taxable income = $40,850

However, since Marie is unmarried and under age 65, she qualifies for the standard deduction of $6,300. This reduces her taxable income further:

Taxable income = $40,850 - $6,300
Taxable income = $34,550

Therefore, the correct answer is B) $32,550.

Marie,an Unmarried Taxpayer,is 26 Years Old