Lila and Ted are married and have AGI of $332,000 in 2014. They had their first children this year,twins. Lila and Ted will be allowed a deduction for personal and dependency exemptions of
A)$7,900.
B)$15,800.
C)$12,324.
D)$3,476.

Question

Quizplus · Accepted Answer

In 2014, the personal exemption amount was $3,950 per person. Lila and Ted can claim exemptions for themselves and their two children, totaling four exemptions. However, their AGI of $332,000 exceeds the phase-out threshold for married couples filing jointly, which begins at $305,050. The phase-out reduces the exemption amount by 2% for each $2,500 (or part thereof) over the threshold. The reduction calculation results in a total deduction of $12,324.

Lila and Ted Are Married and Have AGI of $332,000