In 2021, John and Julie Smith are married and file jointly: Julies Salary $ 60,000 Withholdings from
Question:
In 2021, John and Julie Smith are married and file jointly: Julie’s Salary $ 60,000 Withholdings from Julie’s salary $ 10,000 John’s Salary $ 55,000 Withholdings from John’s salary $ 9,000 Workers’ Compensation payments received by John $ 8,000 Interest on U.S.
Treasury Bonds $ 6,000
Long-term capital loss (LTCL) on the sale of a personal boat (for pleasure) $ 11,000
Cash Dividend from Microsoft Stock (Julie gave the dividend to her mother to help with her bills). $ 3,000
Life Insurance Proceeds (received on the death of John’s grandfather) $120,000
Inheritance from John’s grandfather $ 80,000
Interest credited to Julie’s savings account in 2021 (Julie did not withdraw any of the money) $ 2,000
Itemized Deductions $ 12,000
(1) What is the Smiths’ adjusted gross income (AGI) in 2021?
(2) What is the Smiths’ taxable income in 2021?
(3) What is the Smiths’ tax liability in 2021? (Don't worry about the different tax rate for dividends or capital gains)
(4) What is the Smiths’ tax due or refund amount in 2021?
Expert Answer:
We have assumed given withholdings are federal income tax withholding In 2021 Standard deduc... View the full answer
