ken, a single taxpayer, has a gross income of $79,685. he claims one exemption and can take a deduction of…

ken, a single taxpayer, has a gross income of $79,685. he claims one exemption and can take a deduction of $1,257 for medical expenses, a deduction of $2,181 for interest on his mortgage, an adjustment of $800 for alimony, a deduction of $1,419 for property taxes, an adjustment of $1,722 for business expenses, and an adjustment of $2,511 for contributions to his retirement fund. the standard deduction for a single filer is $5,700, and exemptions are worth $3,650 apiece. using the table below, how much does ken owe in income tax? if line 43 (taxable income) is— and you are— at least but less than single married filing jointly married filing sepa- rately head of a house- hold your tax is— 65,000 65,000 65,050 12,600 8,051 12,600 11,319 65,050 65,100 12,613 8,059 12,613 11,331 65,100 65,150 12,625 8,969 12,625 11,344 65,150 65,200 12,638 8,981 12,638 11,356 65,200 65,250 12,650 8,994 12,650 11,369 65,250 65,300 12,663 9,006 12,663 11,381
Answer
Explanation:
Step1: Calculate adjusted - gross income
Adjusted - gross income (AGI)=Gross income - Adjustments Adjustments = $800 + 1722+2511=$5033 AGI = $79685 - 5033=$74652
Step2: Calculate taxable income
Taxable income=AGI - (Standard deduction + Exemption) Standard deduction for single filer = $5700 Exemption = $3650 Taxable income = $74652-(5700 + 3650)=$65302
Step3: Determine tax amount
Since the taxable income of $65302 is in the range where the income is at least $65250 but less than $65300 for a single filer, the tax amount is $12663.
Answer:
$12663