A and L are married and have two sons J and K, ages 13 and 16. Both sons are pro

Question

A and L are married and have two sons J and K, ages 13 and 16. Both sons are properly claimed as dependency exemptions. A and L had taxable income of $167,500 in 2015 and they file a joint return. J and K had part time jobs as well as some unearned income. Below is a summary of their income for 2015:
J had wages of $600, interest of $300 and dividend from stocks of $1,300.
K had wages of $2,400, interest of $250 and dividend from stocks of $1,900.
Compute the taxable income and tax liability of J and K for 2015.

Explanation / Answer

Answer: Taxable income:

Taxable income of A&L=$167500

J taxable income=2200

K taxable income=4550

Total income=174250

Less: Dependancy exemption=16000 (4000*4)

Taxable income=158250

Tax liability of J=2200*10%=220

Tax liability of K=4550*10%=455

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