R1-M1

Question 1

What is the individual income tax formula?

Answer 1

Gross income-adjustments=adjusted gross income
Adjusted gross income-standard deduction or itemized deduction=taxable income before QBI deduction

Taxable income before QBI deduction-QBI deduction=Taxable Income

Federal Income tax-tax credits + other taxes - payments=Tax due or tax refund

Question 2

What is considered gross income?

Answer 2

Wages, interest, dividends, state tax refunds, alimony received, business income, capital gain/loss, IRA income, pension and annuity, rental income/loss, K-1 flow through income/loss, unemployment compensation, social security benefits, and other income

Question 3

What are adjustments?

Answer 3

educator expenses, IRA contributions (traditional), student loan interest, health savings account, moving expenses, one half self employment taxes, self employed health insurance, self employed retirement, interest withdrawal penalty, alimony paid, and qualified charitable contributions (up to $300)

Question 4

what are itemized deductions

Answer 4

medical (in excess of 7.5% of AGI), Taxes-state/local (up to $10,000), interest expense (home and investment), charitable contributions, casualty/theft loss attributable to federal disaster (in excess of $100 floor and 10% of AGI)

Question 5

single status

Answer 5

unmarried or legally separated