Shannon is 16 years old and is a qualified dependent of her mother. Shannon earns $1,500 as a counselor at a church summer camp and receives $2,500 of interest on a savings account established by her grandparents. Shannon's 2016 taxable income is:

Question

Quizplus · Accepted Answer

As a qualified dependent, Shannon has a standard deduction of $1,050 in 2016. Therefore, her taxable income will be $1,500 (earned income) + $2,500 (unearned income) - $1,050 (standard deduction) = $2,950. However, the question specifically asks for her taxable income, not her total income, so the correct answer is $2,150 (only her earned income plus her standard deduction).

Shannon Is 16 Years Old and Is a Qualified Dependent