Question: a Calculate the Hernandezes income tax liability for this year

(a) Calculate the Hernandezes’ income tax liability for this year as a joint return (using Table) given the following information: gross salary income (Victor, $56,000; Maria, $51,000); state income tax refund ($400); interest on checking and savings accounts ($250); holiday bonus from Maria’s employer ($375); contributions to qualified retirement accounts ($5500); itemized deductions (real estate taxes, $2600; mortgage interest $6300; charitable contributions, $2500); and exemptions for themselves and their two children ($3950 each).
(b) List five additional strategies that Victor and Maria might consider for next year’s tax planning to reduce next year’s tax liability.

The year before last, Victor earned $51,000 from his retail management position, and Maria began working full-time and earned $45,000 as a medical technician. After they took the standard deduction and claimed four exemptions (themselves plus their two children), their federal income tax liability was about $12,000. After hearing from friends that they were paying too much in taxes, the couple vowed to try to never again pay that much. Therefore, the Hernandezes embarked on a yearlong effort to reduce their income tax liability. This year they tracked all of their possible itemized deductions, and both made contributions to qualified retirement plans at their places of employment.

Sale on SolutionInn
  • CreatedNovember 26, 2014
  • Files Included
Post your question