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Jeremy earned $102,100 in salary and $8,100 in interest income during the year. Jeremy’s employer withheld...

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Finance

Jeremy earned $102,100 in salary and $8,100 in interest incomeduring the year. Jeremy’s employer withheld $11,000 of federalincome taxes from Jeremy’s paychecks during the year. Jeremy hasone qualifying dependent child who lives with him. Jeremy qualifiesto file as head of household and has $32,700 in itemizeddeductions. (Use the tax rate schedules.) Assume the original factsexcept that Jeremy has only $7,000 in itemized deductions. What isJeremy’s tax refund or tax due?

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Calculation of Jeremy's tax refund or Taxes due Tax liability calculation
1. Gross Income (102100+8100) 110200 13850*10%= 1385
2. For AGI deductions (52850-13850)*12%= 4680
3. Adjusted gross income 110200 (77500-52850)*22%= 5423
4.Standard deduction 18350 Total 11488
5.Itemized deductions 32700
6. Greater of standard deduction or itemized deductions 32700
7.Taxable income(110200-32700) 77500
8.Income tax liability(6065+((78400-52850)*22%) 11488 6065+((77500-52850)*22%)
9. Child tax credit 2000
10.Tax withholding by employer 11000
11.Tax refund due(8-9-10) -1512
Calculation of Jeremy's tax refund or Taxes due Tax liability calculation
1. Gross Income (102100+8100) 110200 13850*10%= 1385
2. For AGI deductions (52850-13850)*12%= 4680
3. Adjusted gross income 110200 (84200-52850)*22%= 6897
4.Standard deduction 18350 (91850-84200)*24%= 1836
5.Itemized deductions 7000 Total 14798
6. Greater of standard deduction or itemized deductions 18350
7.Taxable income(110200-18350) 91850
8.Income tax liability (12962+((91850-84200)*24%) 14798 12962+((91850-84200)*24%)
9. Child tax credit 2000
10.Tax withholding by employer 11000
11.Balance Tax due(8-9-10) 1798
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