Question

Jeffrey earned a gross income of $67,930 last year. He made $2,173.93 in student loan interest deductions, donated $2,824 to his favorite charities and paid $3,117.56 in home mortgage interest. Jeffrey claims a standard deduction of $11,400 for himself and his non-working spouse. If their exemption is $7,300, what is their taxable income?

a. $47,056.07
b. $52,514.51
c. $43,938.51
d. $41,114.51

Answer 1

b. $52,514.51. The $2,173.93 in student loan interest deductions, $2,824 to his favorite charities, and $3,117.56 in home mortgage interest are all tax deductible. However, only $7,300 is exempted from his taxes from the $11,400 they claimed for. Subtracting all this from $67,930, we get $52,514.51.