The Johnson's Family

Sigchi4life
Category:
Business & Finance
Price: $5 USD

Question description

Several years have gone by since Harry and Belinda
 graduated from college and started their working careers.
They both earn good salaries. They believe that they are
paying too much in federal income taxes. The Johnsons’
 total income last year included Harry’s salary of $63,000
and  Belinda’s salary of $84,000. She contributed $3000 to
her 401 (k) for retirement. She earned $400 in interest on
savings and checking and $3000 interest income from the
trust that is taxed in the same way as interest income from
checking and savings accounts. Harry contributed $3000
into a traditional IRA.
(a) What is the Johnsons’ reportable gross income on
their joint tax return?
(b) What is their adjusted gross income?
(c) What is the total value of their exemptions?
(d) How much is the standard deduction for the Johnsons?
(e) The Johnsons are buying a home that has monthly
mortgage payments of $3000, or $36,000 a year.
Of this amount, $32,800 goes for interest and real
estate property taxes. The couple has a $14,000  
in other itemized deductions. Using these numbers
and Table 4-2, calculate their taxable income and
tax liability.
(f) Assuming they had a combined $22,000 in federal
income taxes withheld, how much of a refund will
the Johnsons receive?
(g) What is their marginal tax rate?
(h) List three additional ways that the Johnsons might
reduce their tax liability next year.

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