Elio (age 66) is retired. His wife, Mary (age 64) works part-time. They have income from the

Question:

Elio (age 66) is retired. His wife, Mary (age 64) works part-time. They have income from the following sources and plan to file a joint tax return.
Mary’s salary....................................................................................................................................$10,000
Elio’s retirement annuity (all contributions made by his employer)...........................................15,000
Elio’s Social Security benefits..............................................................................................................5,000
Interest income from their municipality’s general revenue bonds................................................1,000
Cash dividend from Ford Motor Company..........................................................................................500
Lottery prize...............................................................................................................................................50

What is their gross income?
a. $31,550
b. $30,500
c. $25,550
d. $10,000

Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...

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