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Required Information

Comprehensive Problem $4-57($LO $4-1,$ LO $4-2,$ LO $4-3)($Algo$)$

$[$The following information applies to the questions displayed below.$]$

Demarco and Janine Jackson have been married for $20$ years and have four children who qualify as their dependents $($Damarcus$,$ Jasmine, Michael, and Candice$).$ The Jacksons file a joint tax return. The couple received salary income of $\backslash (\backslash$$ $98\mathrm{.}500\backslash )$ and qualified business income of $\backslash (\backslash$$ $16\mathrm{.}500\backslash )$ from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $\backslash (\backslash$$ $232,500\backslash )$ and they sold it for $\backslash (\backslash$$ $282,500\backslash ).$ The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $\backslash (\backslash$$ $17,800\backslash )$ of itemized deductions, and they had $\backslash (\backslash$$ $4\mathrm{.}000\backslash )$ withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice was $18$ years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. $($Use the tax rate schedules.$)$

Comprehensive Problem $4-57$ Part$-$a $($Algo$)$

a$.$ What is the Jacksons' taxable income, and what is their tax liability or $($refund$)?$

Note: Do not round Intermedlate calculations.