Which of the following tax formulas is correct? (Gross Income - exclusions - per

Question

Which of the following tax formulas is correct?

(Gross Income - exclusions - personal & dependency exemptions = AGI)
(AGI - adjustments - the greater of the standard deduction or itemized deduction = Taxable Income)

(Gross Income - exclusions - Adjustments = AGI)
(AGI - the greater of the standard deduction or itemized deduction - personal & dependency exemptions = Taxable Income)

(Gross Income - the greater of the standard deduction or itemized deduction - personal & dependency exemptions = AGI)
(AGI - exclusions - adjustments = Taxable Income)

(Gross Income - exclusions - the greater of the standard deduction or itemized deduction = AGI)
(AGI - personal & dependency exemptions - adjustments = Taxable Income)

(Gross Income - exclusions - personal & dependency exemptions = AGI)
(AGI - adjustments - the greater of the standard deduction or itemized deduction = Taxable Income)

(Gross Income - exclusions - Adjustments = AGI)
(AGI - the greater of the standard deduction or itemized deduction - personal & dependency exemptions = Taxable Income)

(Gross Income - the greater of the standard deduction or itemized deduction - personal & dependency exemptions = AGI)
(AGI - exclusions - adjustments = Taxable Income)

(Gross Income - exclusions - the greater of the standard deduction or itemized deduction = AGI)
(AGI - personal & dependency exemptions - adjustments = Taxable Income)

Explanation / Answer

Ans: (Gross Income - exclusions - Adjustments = AGI)
(AGI - the greater of the standard deduction or itemized deduction - personal & dependency exemptions = Taxable Income)

Reason: The caluclation of taxable income under form 1040 of IRS , is done by following the same format.

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