Question

If a single man has a gross income of $62,000 with $1,400 earned interest from a savings account with $4500 in state taxes and $2000 in theft loss, how much would his taxable income be if he has the standard exemption of $4050?

Answer 1

The single man's taxable income is calculated by subtracting the standard exemption, state taxes, and theft loss from his gross income and interest income, which results in a taxable income of $52,850.

Step-by-step explanation:

The question involves calculating the taxable income for a single man who has a gross income of $62,000, $1,400 of interest income from a savings account, $4,500 in state taxes, and a $2,000 theft loss. He also has a standard exemption of $4,050.

To calculate his taxable income, we will follow these steps:

1. Determine the adjusted gross income (AGI) by adding the interest income to the gross income. AGI = $62,000 + $1,400 = $63,400.
2. Subtract any applicable deductions from the AGI. Since he has a theft loss of $2,000 and state taxes of $4,500, we subtract these amounts. New AGI = $63,400 - $2,000 - $4,500 = $56,900.
3. Subtract the standard exemption from the new AGI to find the taxable income. Taxable Income = $56,900 - $4,050 = $52,850.

Therefore, the single man's taxable income would be $52,850.