nstatus fo Or and Macy do not and 2018 if all parties reside in: a. Idaho (a com

Question

nstatus fo Or and Macy do not and 2018 if all parties reside in: a. Idaho (a community property state)? b. Kansas (a common law state)? e, age 17, is a dependent of her parents. During 2018, Paige e $3,900 pet sitting and $4,100 in interest on a savings account. Wha 46. LO.1, 3,7 Paig Paige's taxable income and tax liability for 2018? LO.1, 3,7 Terri, age 16, is a dependent of her parents. During 2018, Terni ean $5,000 in interest income and $3,000 from part-time jobs. a. What is Terri's taxable income? b. What is Terri's net unearned income? c. What is Terri's tax liability? LO.8 During 2018, In ez (a single taxpayer) had the following transactions invwl capital assets

Explanation / Answer

Earned Income $3,900.00 Interest income $4,100.00 Gross Income $8,000.00 Less: Personal exemption 0 Less: Standard deduction [Greater if $1050 or $3900 (earned income) + $350] -$4,250.00 Taxable income $3,750.00 Less:Unearned income taxed at parents’ rate -$2,050.00 Income taxed at Paige’s rate $1,700.00 Paige’s tax rate 10.00% Tax at Paige’s rate $170.00 Paige’s total tax = $525 (unearned income taxed at parents rate (22% x 2050)) + $170 (taxed at Paige’s rate) $621.00 working note:- Unearned income $4,100.00 Minus: $1,000 base amount + $1,050 standard deduction -$2,050.00 Unearned income taxed at parents’ rate $2,050.00

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