THE-WFT08-06-1001-ch_16_V4-SM

THE-WFT08-06-1001-ch_16_V4-SM - CHAPTER 16 INTRODUCTION TO...

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CHAPTER 16 INTRODUCTION TO THE TAXATION OF INDIVIDUALS SOLUTIONS TO PROBLEM MATERIALS Status: Q/P in Question/ Present Prior Problem Topic Edition Edition 1 Taxable income calculation Modified 1 2 Taxable income calculation Modified 2 3 Taxable income calculation Modified 3 4 Standard deduction of dependent Modified 4 5 Personal and dependency exemptions Modified 5 6 Personal and dependency exemptions Unchanged 6 7 Personal and dependency exemptions Unchanged 7 8 Exemption deduction determination: phaseout New 9 Tax liability calculations Modified 9 10 Filing requirements Modified 10 11 Tax planning: alternating years for itemized Modified 11 deductions with standard deduction 12 Alimony and property settlement Unchanged 12 13 Prizes and awards New 14 Social Security benefits Unchanged 14 15 Scholarship Unchanged 15 16 Damages Modified 16 17 Medical expense deduction and reimbursement New 18 Ethics problem Unchanged 18 19 Issue ID Unchanged 19 20 Capital expenditures as medical expense New deduction 21 State income tax deduction and refund New 22 Investment interest expense: net investment New income 23 Investment interest expense New 24 Home equity loan: calculation of interest expense Unchanged 24 deduction 25 Charitable contribution-reduced deduction Unchanged 25 election 26 Choice of property for contribution Unchanged 26 27 Issue ID Unchanged 27 16-1
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16-2 2008 Entities Volume/Solutions Manual Status: Q/P in Question/ Present Prior Problem Topic Edition Edition 28 Overall limitations on certain itemized deductions New 29 Adoption expense credit Modified 29 30 Credit for child and dependent care expenses: Unchanged 30 student spouse, payments to relatives 31 Credit for child and dependent care expenses: Unchanged 31 payments to relatives 32 Education tax credits Modified 32 33 Earned income credit Unchanged 33 34 Earned income credit Unchanged 34 35 Earned income credit Modified 35 Comprehensive Tax Return Problem 36 Comprehensive New 37 Comprehensive Modified 37 38 Comprehensive Modified 38 Bridge Discipline Problem 1 Investment alternatives Unchanged 1 2 Investment alternatives Unchanged 2 Research Problem 1 Determining qualification for the dependency New exemption; satisfaction of the support test; tax planning considerations 2 Joint return and innocent spouse relief Unchanged 2 3 Gross income and frequent-flyer miles Unchanged 3 4 Charitable contribution Unchanged 4 5 Internet activity New 6 Internet activity Unchanged 6
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Introduction to the Taxation of Individuals 16-3 PROBLEMS 1. a. AGI $55,000 Less: Standard deduction (married filing jointly) (10,700) Personal and dependency exemptions (4 × $3,400) (13,600) Taxable income $30,700 b. AGI $80,000 Less: Standard deduction (head of household) (7,850) Personal and dependency exemptions (5 × $3,400) (17,000) Taxable income $55,150 c. AGI $75,000 Less: Itemized deductions (8,000) Personal and dependency exemptions (4 × $3,400) (13,600) Taxable income $53,400 d. AGI $48,000 Less: Standard deduction (surviving spouse)
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This note was uploaded on 04/19/2009 for the course BUSINESS ACCT 305 taught by Professor Poletti during the Spring '09 term at DeVry Columbus North.

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THE-WFT08-06-1001-ch_16_V4-SM - CHAPTER 16 INTRODUCTION TO...

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