During 2018, Marla earns $2,700 from a summer job. She also has interest income of $2,400. Marla, age 19, is a full-time student at Western College. Her parents claim her as a dependent. Their taxable income is $100,000. What is Marla's tax liability for 2018?

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Quizplus · Accepted Answer

Marla's tax liability is calculated on her earned income ($2,700 from her summer job) and her unearned income ($2,400 in interest). For a dependent, the first $1,050 of unearned income is not taxed, and the next $1,050 is taxed at the child's tax rate. Any unearned income above $2,100 is taxed at the parents' tax rate. However, since Marla's total income ($5,100) is less than the standard deduction for a single filer in 2018 ($12,000), her earned income is not taxed. Her unearned income above $2,100 would be taxed, but given the specifics, her tax liability is calculated on the $1,350 of unearned income above the $1,050 threshold, likely at her tax rate, leading to the $205 figure, assuming a specific tax rate for this calculation.

During 2018, Marla Earns $2,700 from a Summer Job