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Paige, age 17, is claimed as a dependent on her parents' 2015return, on which they report taxable income of $120,000 (noqualified dividends or capital gains). Paige earned $3,900 petsitting and $4,100 in interest on a savings account. What arePaige's taxable income and tax liability for 2015? If an amount iszero, enter "0".

a. Paige's standard deduction is $ .

b. Paige's personal exemption is $ .

c. Paige's total taxable income is $ ; however,only $ will be taxed at her rate.

d. Compute Paige's "net unearned income" forthe purpose of the kiddie tax. $

e. Assuming that her parents are in the 25% taxbracket and Paige is in the 10% tax bracket, compute her taxliability.
$

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Jamar Ferry
Jamar FerryLv2
28 Sep 2019

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Taylor, age 16, is claimed as a dependent by her parents. For 2017, she records the following income: $5,200 wages from a summer job, $1,755 interest from a money market account, and $2,100 interest from City of Boston bonds. If required, round your answers to the nearest dollar. If an amount is zero, enter "0". a. Taylor's standard deduction is $ . Taylor's personal exemption is $ . Taylor's taxable income is $ . Feedback To reduce the tax savings that result from shifting income from parents to children, the net unearned income (commonly called investment income) of certain children is taxed as if it were the parents' income. Special rules apply to the standard deduction and personal exemption of an individual who can be claimed as a dependent on another person's tax return. b. Compute Taylor's "net unearned income" for the purpose of the kiddie tax. $ Assume that Taylor's tax rate is 10% and her parents' tax rate is 28%. If Taylor's parents file a joint return and report taxable income of $130,000, then Taylor's tax is $ .

1.During the current year, Margie earned wage income of$300,000. If Margie is single, which of the following statementsregarding her Medicare tax liability is true?

a.Margie will owe both the regular 1.45 percent Medicare tax andthe additional .9 percent Medicare tax on her entire wageincome.

b.Margie will owe the regular 1.45 percent Medicare tax on herentire wage income and the additional .9 percent Medicare tax onlyon her wage income in excess of $200,000.

c.Margie will owe the regular 1.45 percent Medicare tax on herentire wage income and the additional .9 percent Medicare tax onlyon her wage income in excess of $250,000.

d.Margie's employer is required to withhold both the regularMedicare tax but does not withhold the additional .9 percentMedicare tax.

2.Ruth Anne, a single taxpayer, reported $152,600 alternativeminimum taxable income before any exemption on her 2016 Form 1040.Calculate Ruth Anne's AMT exemption.

a.$8,225

b.$45,675

c.$53,900

d.None of the above

3.Melissa, age 16, is claimed as a dependent on her parents' taxreturn. This year, Melissa earned $2,000 from babysitting and$1,280 interest income from a savings account. Compute Melissa'sstandard deduction.

a.$2,000

b.$2,350

c.$0

d.$1,050

1.Which of the following statements concerning the exemptionphaseout is true?

a.The phaseout applies only to taxpayers with a 39.6% marginalincome tax rate.

b.The phaseout can reduce a taxpayer's exemption amount tozero.

c.The phaseout doesn't apply to taxpayers who use the standarddeduction instead of electing to itemize deductions.

d.Statements A., B., and C. are false.

2.In 2016, Amanda earned $70,000 self-employment income. She wasallowed a $4,945 above-the line deduction for her SE tax. ComputeAmanda's maximum contribution to her profit-sharing Keogh plan.

a.$13,011

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c.$65,055

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3.This year, Mrs. Pike's compensation from her corporateemployer consisted of $325,000 current salary and $75,000 unfundeddeferred compensation payable upon her retirement at age 66. Whichof the following statements is true?

a.This year, Mrs. Pike must include $400,000 in gross income,and her employer is allowed a $400,000 deduction.

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a.$8,225

b.$45,675

c.$53,900

d.None of the above

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$2,000

$2,350

$0

$1,050

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