Question

Sammy, a calendar year cash basis taxpayer who is age 66, has the following source of income and expenses: Salary $90,000 IRA Distribution - Roth IRA $10,000 Medical expenses ($8,000) Sammy also made a charitable contribution of ABC Shares. The FMV at the date of the contribution was $5,000. Sammy inherited the shares 5 years ago. At that time the FMV of the shares was $3,500. Based on this information, Sammy has:

Answer 1

Adjusted Gross income of $90,000

Step-by-step explanation:

The computation of the adjusted gross income is as follows:

Salary income- 90,000

IRA Distribution $0

Adjusted Gross Income $90,000.

We assume the IRA distribution is a tax free

Therefore the sammy has the adjusted gross income of $90,000 and the same is to be considered