Mr. C, an unmarried individual, had the following income items: He had $17,300 i

Question

Mr. C, an unmarried individual, had the following income items:

He had $17,300 itemized deductions and no dependents. Compute Mr. C’s income tax. Use Individual Tax Rate Schedules. (Round your answers to the nearest whole dollar amount.)

AGI $184800

Tabable income

Income tax

http://ezto-cf-media.mheducation.com/Media/Connect_Production/bne/accounting/jones_20e/individual_tax_rate_schedules_2016.jpg

Interest income $ 14,200 Ordinary loss from an S corporation (8,400 ) Ordinary income from an LLC 179,000

Explanation / Answer

AGI = $179000+$14200-$8400 = $184800

Taxable income = $184800 - allowed itemized deduction(Under United States tax law, itemized deductions are eligible expenses that individual taxpayers can claim on federal income tax returns and which decrease their taxable income, and is claimable in place of a standard deduction, if available)

= $184800-$17300

= $167500

Income tax:

Mr. C is single with income over $91150 but not over $190150

Therefore tax for mr. C will be

18558.75 + (167500-91150)×28%

= 18558.75 + 21378

= $39936.75

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