Reference no: EM131059590

Michigan state tax:The following information relates to David and Mary Hopkins for tax year 2014. Please use this information to provide answers to the questions on the separate page. You will submit the "answer page" only.

David (50) and Mary (49) are married and file a joint tax return. David is the office manager for an accounting firm and Mary is the manager of a restaurant in their town. David and Mary have 3 children: Kim (10), Karen (17) and Karl (25) who lived with them all year. Kim is in elementary school. Karen is a high school senior. Karl is in graduate school and commutes to classes. Karen earned $4,300 as a waitress and Karl earned $3,100 as a sailing instructor during the summer and $2,500 as a graduate research assistant during the regular school year. David and Mary furnish 60% of the support of David's aunt, Ann, who lived alone in her own residence during the year. Ann provided the rest of her support from her non taxable Social Security benefits and $4,000 of interest from a City of Grand Rapids, MI bond. Ann passed away in April and David was the beneficiary on her life insurance policy and received $100,000 in life insurance proceeds on May 2nd. The Hopkins had the following income and expenses during the 2014 tax year:

ITEM	AMOUNT
Property taxes	$5,210
Interest on home mortgage	6,308
Repairs to the furnace of their home	750
Utilities for their home	3,500
Fire and theft insurance for their home	1,500
Medical insurance premiums	12,530
Doctor for Ann (from 2013 paid in 2014)	2,410
Operation for Ann	9,000
Prescription medicine for Ann	3,600
Hospital expenses for Ann	12,700
Reimbursement from medical insurance (received in 2014 for 2014 expenses)	5,600
Additional state income tax paid when return filed	1,700
Tickets to fashion show for the Youth Association (qualified charitable organization) comparable cost would be $75.	325
Contribution to Lutheran Church	7,000
Used clothing to Salvation Army (cost $1,600)	FMV    $470
Received interest income from National Bank	1,740
Received interest income from Providence, RI bonds	2,500
Uniforms for Mary (required by employer)	460
Fee paid to have tax return prepared	380
David donated 20 hours of services to the church	FMV of services 1,000
David's subscription to Office Management Quarterly	230
Laundry for required uniforms	270
Mary's subscription to "Journal of Franchise Management"	300
David's W-2 income	117,000
David's state income tax withheld	6,950
Mary's W-2 income	62,900
Mary's state income tax withheld	4,100

Answer Sheet

Please provide your answers to the following problems.

Number of exemptions allowed for 2014 for the Hopkins

Total Gross Income for 2014 for David and Mary Hopkins

Allowable miscellaneous itemized deductions for the Hopkins for 2014 prior to any limitations

Allowable medical deduction for the Hopkins for 2014 prior to any limitations

Allowable interest deduction for the Hopkins for 2014

Allowable taxes deduction for the Hopkins for 2014

Allowable charitable contribution deduction for 2014 for the Hopkins

Assume the Hopkins Taxable Income was $230,000. Tax liability for 2014

Assume the Hopkins Taxable Income was $75,900. Tax liability for 2014

Assume the Hopkins' Adjusted Gross Income is $168,000, they are entitled to 7 exemptions, and their itemized deductions after all limitations are $9,500. What is their Taxable Income