Problem 6-34 (LO. 1)

Daniel, age 38, is single and has the following income and expenses in 2019:

Salary income	$60,000
Net rent income	6,000
Dividend income	3,500
Payment of alimony (divorce finalized in March 2019)	12,000
Mortgage interest on residence	9,900
Property tax on residence	1,200
Contribution to traditional IRA (assume the amount is fully deductible)	5,000
Contribution to United Church	2,100
Loss on the sale of real estate (held for investment)	2,000
Medical expenses	3,250
State income tax	300
Federal income tax	7,000

Daniel's standard deduction for 2019 is $12,200.

Payment of alimony	Not deductible
Mortgage interest on residence	Deductible from AGI
Property tax on residence	Deductible from AGI
Contribution to traditional IRA (assume the amount is fully deductible)	Deductible for AGI
Contribution to United Church	Deductible from AGI
Loss on the sale of real estate (held for investment)	Deductible for AGI
Medical expenses	Deductible from AGI
State income tax	Deductible from AGI
Federal income tax	Not deductible

Please answer the following:

a. What is Daniel's gross income and his AGI? Gross income: $69,500 AGI: $_____________

b. Should Daniel itemize his deductions from AGI or take the standard deduction? Because Daniel's total itemized deductions (after any limitations) are $_____________, he would benefit from itemizing his deductions .