Question - Show all components of your work for partial credit review.
Rob (age 40) and Susan (age 39) Cowen are married. Susan works as a retail manager and Rob is a self-employed electrician but does not maintain a home office. Their 2014 tax and other information are as follows:
|
Salary - Susan
|
75,000
|
|
Federal withholding on salary
|
29,000
|
|
State withholding on salary
|
4,000
|
|
Interest income on municipal bonds:
|
|
|
State of Connecticut
|
2,000
|
|
Savings account interest
|
900
|
|
Dividends from RGR, Inc. (all are non-qualified)
|
3,000
|
|
Value of employer provided medical insurance
|
2,000
|
|
Inheritance from Susan's father's estate
|
7,000
|
|
Interest paid on personal car loan
|
800
|
|
Interest paid on personal loan
|
1,000
|
|
Child support paid to Rob's ex-wife
|
10,000
|
|
Alimony paid to Rob's ex-wife
|
3,000
|
|
Qualified Out of Pocket Medical Expenses
|
4,000
|
|
Donations to church
Real Estate taxes on primary residence
|
2,500
6,000
|
|
Mortgage interest on primary residence (<$1M)
|
4,000
|
|
Rob's business revenues
|
50,000
|
|
Rob's business expenses
|
17,000
|
Required: Using the tax formula format, determine the following for the Cowen's 2015 tax year (show all calculations):
a. All Income
b. Exclusions (if any)
c. Gross income (including Rob's SE income)
d. Deductions For AGI
e. Adjusted gross income
f. Itemized deduction or standard deduction amount
g. Deduction for exemptions
h. Taxable income
i. Income tax liability
j. Self-employment tax liability
k. Net tax due or refund (show calculation)