Sarah Singleton (born July 1, 1970, and Social Security Number 473-12-1234), who lives at 123 Main Street
Question:
Sarah Singleton (born July 1, 1970, and Social Security Number 473-12-1234), who lives at 123 Main Street in Mankato, MN 56001 (Blue Earth County), is single, has 20-20 vision, and has no dependents. She works 40 hours per week at a retail store in Mankato, MN, and generates $40,000 of income. Additionally, $10,000 federal income tax and $7,000 of state of MN income tax were withheld from her wages from this job, as reported on her W-2.
In 2019 Sarah’s mother passed away, and Sarah inherited $50,000 in cash. Additionally, her father gave her $20,000 as a birthday present. Sarah placed the money in Wells Fargo Bank and earned $500 of taxable interest income.
Sarah has the following itemized deductions:
State Property taxes on her home $6,000
State of MN income tax withheld of $7,000 (as indicated above)
Home Morgage interest of $5,000
Interest on her car loan of $1,000
Donation to local church $500
Gambling losses of $5,000, Sarah has no gambling winnings
1. What is Sarah's Adjusted Gross Income
2. Identify which items qualify as an itemized deduction on Schedule A for the tax year 2019?
3. What are Sarah's total itemized deductions for the tax year 2019?
Expert Answer:
