Herbert and Wendy are Married Filing Jointly taxpayers.  During 2020, they each made $40,000 in W2 wages (total $80,000).  They also have a joint investment account.  The investment account reported on a 1099-DIV the payment of Ordinary dividends of $1,200 and qualified dividends of $800.  In the material attached to the 1099-DIV, the documents reported that $600 of the ordinary dividends and $400 of the qualified dividends were from foreign of various sources.  It also reported foreign taxes paid of $35.

The couple has 3 dependents:  Wyatt - 18 months old, Emily – 7 years old. And Kate – 19 years old.  Kate is a Sophomore (full-time student) at UW-Whitewater.  Kate’s 1098T from the University shows her tuition (all paid) was $8,500 and she had a scholarship of $2,000.  Kate has never had any trouble with the police.  Additionally, the couple paid $4,500 for child care for Wyatt during the year.  Calculate Herbert and Wendy’s tax credits for the year.  (SHOW YOUR WORK)

Answer rating: 100% (QA)

Step 1 Herbert and Wendy are married filing jointly taxpayers During 2020 Wages income for both 8000... View the full answer