Jane and Ed Rochester are married with a two-year-old child who lives with them and whom they
Question:
Jane and Ed Rochester are married with a two-year-old child who lives with them and whom they support financially. In 2017, Ed and Jane realized the following items of income and expense:
Item | Amount | ||
Ed’s Salary | $ | 35,000 | |
Jane’s Salary | | 34,400 | |
Municipal bond interest income | | 400 | |
Alimony paid (for AGI deduction) | | (7,000 | ) |
Real property tax (from AGI deduction) | | (10,000 | ) |
|
They also qualified for a $1,000 tax credit. Their employers withheld $1,800 in taxes from their paychecks (in the aggregate). Finally, the 2017 standard deduction amount for MFJ taxpayers is $12,700 and the 2017 exemption amount is $4,050.
What are the couple's taxes due or tax refund (use the tax rate schedules not tax tables)?
Concepts in Federal Taxation
ISBN: 9780324379556
19th Edition
Authors: Kevin E. Murphy, Mark Higgins, Tonya K. Flesher