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Blake and Valerie Meyer (both age 30) are married with one dependent child (age 5).

-Blakes gross salary from his corporate employer was $70,000, and his Section 401(k) contribution was $6,300.

-Valeries salary from GuiTech, an S corporation, was $29,400.

-Valerie owns 16 percent of GuiTechs outstanding stock. Her pro rata share of GuiTechs ordinary business income was $13,790, her pro rata share of GuiTechs net loss from rental real estate was $8,100, and she received a $7,000 cash distribution from GuiTech. The ordinary income from GuiTech is qualified business income.

-Blake received a $15,000 cash gift from his grandmother.

-Valerie won $6,400 in the Maryland state lottery.

-The Meyers received a distribution from their investment in Pawnee Mutual Fund that consisted of a $712 qualifying dividend and a $3,020 long-term capital gain.

-Blake paid $12,000 alimony to a former spouse under a divorce agreement executed in 2011.

-The Meyers paid $14,200 home mortgage interest on acquisition debt and $2,780 property tax on their personal residence.

-The Meyers paid $7,000 state income tax and $4,200 state and local sales tax.

-Valerie contributed $1,945 to the First Baptist Church.

On the basis of the above information, compute the Meyers 2018 federal income tax (including any AMT) on their joint return. Assume the taxable year is 2018. Use Individual tax rate schedules, Standard deduction table and Tax rates for capital gains and qualified dividends. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.)

INDIVIDUAL TAX RATES Married Filing Jointly and Surviving Spouse The tax is: 10% of taxable income $ 1,905.00 + 1 2% of excess over $ 1 9,050 $8,907.00 + 22% of excess over $77,400 $281 79.00 + 24% of excess over $ 1 65,000 $641 79.00 + 32% of excess over $31 5,000 $91,379.00 + 35% of excess over $400,000 $ 1 6 1 ,379.00 + 37% of excess over $600,000 If taxable income is: Not over $19,050 Over $19,050 but not over $77,400 Over $77,400 but not over $165,000 Over $165,000 but not over $315,000 Over $315,000 but not over $400,000 Over $400,000 but not over $600,000 Over $600,000 Marrled Fling Separately If taxable income is: Not over $9,525 Over $9,525 but not over $38,700 Over $38,700 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 but not over $300,000 Over $300,000 The tax is: 10% of taxable income $952.50+ 12% of excess over $9,525 4,453.50 + 22% of excess over $38,700 $ 14,089.50 + 24% of excess over $82,500 $32,089.50 + 32% of excess over $157,500 $45,689.50 + 35% of excess over $200,000 $80,689.50 + 37% of excess over $300,000 Heads of Household If taxable Income Is: Not over $13,600 Over $13,600 but not over $51,800 Over $51,800 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 but not over $500,000 Over $500,000 The tax Is: 10% of taxable income $1.360.00 + 1 2% of excess over $13,600 $5,944.00 + 22% of excess over $51 ,800 $ 1 2,698.00 + 24% of excess over $82,500 $30,698.00 + 32% of excess over $ 1 57,500 $44,298.00 + 35% of excess over $200,000 $1 49,298.00 + 37% of excess over $500,000 Single If taxable income is: Not over $9,525 Over $9,525 but not over $38,700 Over $38,700 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 but not over $500,000 Over $500,000 The tax is: 10% of taxable income $952.50 + 1 2% of excess over $9,525 $4,453.50 22% of excess over $38,700 $14,089.50 + 24% of excess over $82,500 $32,089.50 + 32% of excess over $157,500 $45,689.50 35% of excess over $200,000 $150,689.50 + 37% of excess over $500,000 ESTATE AND TRUST TAX RATES If taxable Income Is: Not over $2,550 Over $2,550 not over $9.150 Over $9,150 not over $12,500 Over $12,500 The tax Is: 10% of taxable income $255 + 24% of the excess over $2,550 $ 1 ,839 + 35% of the excess over $9,150 $301 1 .50 + 37% of the excess over $ 1 2,500 Married filing jointly and surviving spouses Married fing separately Head of household Single $24,000 12,000 18,000 12,000 Tax rates for capital gains and qualified dividends. Rate Taxable Income Single Head of Trusts and Married Filing Jointly Married Filing Separately $0 $38,600 $38,601- Household Estates 096". S0 -$77,200 $0-$38,600 $0 $51,700 $0 -$2,600 $77,201- $479,000 1596 ** $38,601 -$425,800 $51,70:1 $2,601 -$12,700 $239,500 $452,400 20% $479,000+ $239,500+ $425,801-+ $452,401+ $12,701+ * The highest income amount in this range for each filing status is referred to as the maximum zero rate amount ** The highest income amount in this range for each filing status is referred to as the maximum 15-percent amount. INDIVIDUAL TAX RATES Married Filing Jointly and Surviving Spouse The tax is: 10% of taxable income $ 1,905.00 + 1 2% of excess over $ 1 9,050 $8,907.00 + 22% of excess over $77,400 $281 79.00 + 24% of excess over $ 1 65,000 $641 79.00 + 32% of excess over $31 5,000 $91,379.00 + 35% of excess over $400,000 $ 1 6 1 ,379.00 + 37% of excess over $600,000 If taxable income is: Not over $19,050 Over $19,050 but not over $77,400 Over $77,400 but not over $165,000 Over $165,000 but not over $315,000 Over $315,000 but not over $400,000 Over $400,000 but not over $600,000 Over $600,000 Marrled Fling Separately If taxable income is: Not over $9,525 Over $9,525 but not over $38,700 Over $38,700 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 but not over $300,000 Over $300,000 The tax is: 10% of taxable income $952.50+ 12% of excess over $9,525 4,453.50 + 22% of excess over $38,700 $ 14,089.50 + 24% of excess over $82,500 $32,089.50 + 32% of excess over $157,500 $45,689.50 + 35% of excess over $200,000 $80,689.50 + 37% of excess over $300,000 Heads of Household If taxable Income Is: Not over $13,600 Over $13,600 but not over $51,800 Over $51,800 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 but not over $500,000 Over $500,000 The tax Is: 10% of taxable income $1.360.00 + 1 2% of excess over $13,600 $5,944.00 + 22% of excess over $51 ,800 $ 1 2,698.00 + 24% of excess over $82,500 $30,698.00 + 32% of excess over $ 1 57,500 $44,298.00 + 35% of excess over $200,000 $1 49,298.00 + 37% of excess over $500,000 Single If taxable income is: Not over $9,525 Over $9,525 but not over $38,700 Over $38,700 but not over $82,500 Over $82,500 but not over $157,500 Over $157,500 but not over $200,000 Over $200,000 but not over $500,000 Over $500,000 The tax is: 10% of taxable income $952.50 + 1 2% of excess over $9,525 $4,453.50 22% of excess over $38,700 $14,089.50 + 24% of excess over $82,500 $32,089.50 + 32% of excess over $157,500 $45,689.50 35% of excess over $200,000 $150,689.50 + 37% of excess over $500,000 ESTATE AND TRUST TAX RATES If taxable Income Is: Not over $2,550 Over $2,550 not over $9.150 Over $9,150 not over $12,500 Over $12,500 The tax Is: 10% of taxable income $255 + 24% of the excess over $2,550 $ 1 ,839 + 35% of the excess over $9,150 $301 1 .50 + 37% of the excess over $ 1 2,500 Married filing jointly and surviving spouses Married fing separately Head of household Single $24,000 12,000 18,000 12,000 Tax rates for capital gains and qualified dividends. Rate Taxable Income Single Head of Trusts and Married Filing Jointly Married Filing Separately $0 $38,600 $38,601- Household Estates 096". S0 -$77,200 $0-$38,600 $0 $51,700 $0 -$2,600 $77,201- $479,000 1596 ** $38,601 -$425,800 $51,70:1 $2,601 -$12,700 $239,500 $452,400 20% $479,000+ $239,500+ $425,801-+ $452,401+ $12,701+ * The highest income amount in this range for each filing status is referred to as the maximum zero rate amount ** The highest income amount in this range for each filing status is referred to as the maximum 15-percent amount

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