The Johnsons Calculate Their Income Taxes
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.
c) What is the total value of their exemptions?
(d) How much is the standard deduction for the Johnsons?