Ch 03: End-of-Chapter Problems - Preparing Your Taxes Back to Assignment Attempts 0 Keep the Highest 0/1 3. Ch03 Financial Planning Exercise 5 Chapter 3 eBook Financial Planning Exercise 5 Calculating taxable income for a married couple filing jointly Freya and Sebastian Hunter are married and have one child. Sebastian is putting together some figures so he can prepare the Hunters' joint 2018 tax return. So far, he's been able to determine the following concerning income and possible deductions: Total unreimbursed medical expenses incurred Gross wages and commissions earned $1,155 50,700 IRA contribution 5,000 Mortgage interest paid 5,300 Capital gains realized on assets held less than 12 1,450 months Income from limited partnership Interest paid on credit cards Qualified dividend income earned Sales taxes paid Charitable contributions made Capital losses realized Interest paid on a car loan Social Security taxes paid Property taxes paid State income taxes paid 150 360 600 2,490 1,250 3,475 570 2,700 700 1,700 Given this information, determine the amount of the available itemized deductions. How much taxable income will the Hunters have in 2018? (Note: Assume that Sebastian is not covered by a pension plan where he works, his child qualifies for the child tax credit, and the standard deduction of $24,000 for married filing jointly applies.) Do not round your intermediate computations. Chapter 3 eBook Financial Planning Exercise 7 Effect of tax credit vs. tax exemption By defining after-tax income, demonstrate the differences resulting from a $1,000 tax deduction versus a $1,000 tax credit for a single taxpayer in the 12% tax bracket with $35,000 of pre-tax income. Round your answers to two decimal places. (Use Exhibit 3.3.) After-tax income with tax deduction $ After-tax income with tax credit $ Grade it Now Save & Continue Continue without saving