leducation.com/flow/connect.html mprehensive Problems Required Information The f
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leducation.com/flow/connect.html mprehensive Problems Required Information The followng information applies to the questions displayed belowl Camille Sikorskl was divorced last year. She currently provides a home for her 15-year-old daughter Kaly Kaly lived in Camille's home for the entire year, and Camille paid for all the costs of maintaining the home. She receved a salary of $105,000 and contributed $6,000 of It to a qualified retrement account (a for AGI deduction). She also receved $10,000 of alimony from her former husband. Finally, Camile pald $15,000 of expenditures that qualified as itemized deductions c. Assume the original facts but now suppose Camile's daughter, Kaly, is 25 years old and a full-ime student Kaly's gross income for the year was $5,000 Kaly provided $3,000 of her own support, and Camille provided $5.000 of support What is Camile's taxable Income? Description (1) Gross income (2) For AGI deductions (3) Adjusted gross income (4) Standard deduction (5) Itemized deductions Taxable incomeExplanation / Answer
Gross Income=105,000+10,000=115,000
For AGI Deductions=6000
Adjusted Gross Income=109,000
Standard Deduction=9250 Itemized deduction=15000+10000=25000
TP may deduct greater of his standard deduction or his itemized deductions from AGI so Itemized to be reduced
Child support =5,000(both are applicable 3000+2000)
Allowed as per rules
A qualifying child must:
Taxable Income=$ 78,000
C) The Child support deductible will be reduced by 2,000 as age is above 17 so not applicable. The $ 3000 is admissible as support. Taxable Income will increase by $2,000.
As it is not more than half living expenses provided by the child child care is admissible. Meaning Camille has provided more than half of the living expenses so she can be termed as a dependant.
So Taxable income=78000+2000=$80,000
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