Comprehensive Problem (Tax Return Problem). Harvey and Betty Duran, both age 37 , are married with one dependent child. Determine their taxable income from the following information for 2017, and their tax liability. Both the \(\mathrm{ABC}\) and \(\mathrm{XYZ}\) partnerships are passive activities. Assume dividends are taxed as ordinary income.

Transcribed Image Text:

Harvey's salary Betty's salary Dividends received from domestic corporations (nonqualified) Interest Itemized deductions Net loss from ABC Partnership (acq. 1983) Net loss from XYZ Partnership (acq. 1988) Harvey's business income (moonlighting) Harvey's business deductions (before home office expenses) Harvey's home office expenses Net loss on rental property Federal Income tax withheld $45,000 62,000 11,000 7,000 6,920 (14,200) (6,000) 7,700 22,000 10,500 (31,000) 9,600