Question: I only need help solving the taxable portion of the pension income & social security income. Please show or explain how you got your answer.
I only need help solving the taxable portion of the pension income & social security income. Please show or explain how you got your answer. Thank you!!
Abe, who is single, retired from his job this year. He received a salary of $20,000 for the portion of the year that he worked, tax-exempt interest of $3,200, and dividends from domestic corporations of $3,000. On August 1, he began receiving monthly pension payments of $1,000 and Social Security payments of $500. Assume an exclusion ratio of 40% for the pension. Abe owns a duplex that he rents to others. He received rent of $19,000 and incurred $24,000 of expenses related to the duplex. He continued to actively manage the property after he retired from his job. Requirement Compute Abe's adjusted gross income. . Salary Dividend income 20000 3000 19000 Rental income Pension income (taxable portion) Social security income (taxable portion) Gross income Minus: Deductions for Adjusted gross income Rental expenses 24000 Adjusted gross income
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