Determine the gross income for the cowen tax year

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Reference no: EM132019927

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)

Reference no: EM132019927

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