Question

Mike is divorced. His dependent daughter, Sara, lived with him all year. Property taxes of $1,000 and mortgage interest of $4,000 on the home where he and Sara live are divided equally with his ex-wife. Mike paid the utilities of $100 per month. What portion of the yearly household expenses allows him to qualify for head of household filing status

Answer 1

Answer: $3,700

Step-by-step explanation:

To be the head of household, the criteria to be met is;

• Mike should pay for more than 50% of the household expenses
• Mike must be unmarried for the tax year
• Mike must have a qualifying child or dependent.

All the above are met with Mike paying for more than 50% of the household expenses.

He pays half of property taxes of $1,000 and mortgage interest of $4,000;

= (1,000 + 4,000) / 2

= $2,500

And he pays utilities of $100 per month;

= 100 * 12

= $1,200

Total = 1,200 + 2,500

= $3,700

Total expenses = 1,000 + 4,000 + 1,200

= $6,200

Mike pays $3,700 which is more than half of $6,200.