Problem 1-7 The Tax Formula for Individuals, Filing Status and Tax Computation (

Question

Problem 1-7 The Tax Formula for Individuals, Filing Status and Tax Computation (LO 1.3, 1.5, 1.6, 1.7) Ulysses and Penelope are married and file separate returns for 2017. Penelope itemizes her deductions on her return. Ulysses' adjusted gross income was $17,400, his itemized deductions were $2,250, and he is entitled to one exemption. Table for the standard deduction Filing Status Single Married, filing jointly Married, filing separately Head of household 2017 Standard Deduction $6,350 12,700 6,350 9,350 12,700 Qualifying widow(er) Click here to access the tax tables Calculate Ulysses income tax liability assuming the couple does not live in a community property state. Feedbaci

Explanation / Answer

1-7)

Adjusted Gross Income $17,400.00 Less: Greater of standard deduction or itemized deductions ($6350>$2250) -$6,350.00 Less: Personal Exemption -$4,050.00 Taxable Income $7,000.00 Tax Liability = 10% x $7000 $700.00

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