Answer to Question #291020 in Accounting for Jen

Question

Latesha​, a single​ taxpayer, had the following income and deductions for the tax year 2021.

Compute Latesha's taxable income and federal tax liability for 2021 ​(round to dollars and ignore the qualified business income deduction and​ self-employment taxes for this​ problem).

Salary $100,000

Business income $25,000

Interest income from taxable bonds $10,000

Interest income from tax-exempt bonds $5,000

Total income from whatever source derived $140,000

Minus: Exclusions, as provided in the tax law

 Interest income from tax-exempt bonds -($5,000)

Gross income $135,000

Minus: Deductions for Adjusted gross income

 Business expenses $?

Adjusted gross income (AGI) $?

Minus: Deductions from AGI:

 Account name? $?

Account name? $?

Taxable income $?

Tax $?

Answer 1

Add Income 100000

                      140000

                     240000

           Add   35000

                      175000

Less tax             5000

Exemptions

Taxable income       170000

Business Expenses = 0

Adjusted Gross income (AGI) = $175000

Deductions from AGI= $ 5000

Account Name: LATESHA ACCOUNT

Taxable Income= $170000