During 2016, Julio attended school for much of the year but was supported by his parents. Julio

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During 2016, Julio attended school for much of the year but was supported by his parents. Julio married Jillian in December 2016. Julio graduated and began working full-time in 2017. Jillian worked during 2016 and earned $20,000. Julio's only income was $800 of interest. Julio's parents are in the 28% tax bracket. Thus, claiming Julio as a dependent would save them $1,134 (0.28 × $4,050) of taxes.
a. Compute Julio and Jillian's gross tax if they file a joint return.
b. Compute Jillian's gross tax if she files a separate return in order to allow Julio's parents to claim him as a dependent.
c. Which alternative would be better for the family? In other words, will filing a joint return save Julio and Jillian more than $1,134?
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Federal Taxation 2017 Comprehensive

ISBN: 9780134421438

30th Edition

Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson

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