Question

Annie, age 70 and single, is claimed as a dependent on her daughter's tax return. During 2019, she had interest income of 2,400 and800 of earned income from babysitting. Annie's taxable income is:

1) $400.
2) $1,850.
3) $2,400.
4) $2,250.
5) $2,200.

Answer 1

The taxable income calculation for Annie, who has both earned and unearned income while being claimed as a dependent, reveals that none of the provided answer choices correctly match the calculation based on standard deduction rules for dependents in 2019. Her correct taxable income would be $1,300, which is not listed among the options.

Step-by-step explanation:

The question seeks to calculate Annie's taxable income given her interest income and earned income from babysitting while being claimed as a dependent. To determine taxable income, we need to consider the tax filing rules for dependents. In 2019, if a dependent has both earned and unearned income, such as Annie, the standard deduction for her earned income would be up to $1,100 plus the earned income, with a maximum of $12,200. Annie's earned income from babysitting is $800, and her unearned income (interest) is $2,400.

Hence, her standard deduction is $1,100 + $800 (earned income), which totals $1,900. Subtracting the standard deduction from her total income ($3,200), her taxable income would be $1,300.

However, none of the proposed answers match this calculation. Therefore, we must note that all answers given (1) $400, (2) $1,850, (3) $2,400, (4) $2,250, and (5) $2,200 are incorrect based on the provided data.