Question

Robert is 66 and so qualifies for the age amount. His taxable income for 2017 was 65000. The threshold income for the age amount is $36 430 and the maximum age amount is $7225. What age amount will he qualify for?

A) $4285
B) $2940
C) $7225
D) Zero

Answer 1

Robert is 66 and so qualifies for the age amount. His taxable income for 2017 was 65000. The threshold income for the age amount is $36 430 and the maximum age amount is $7225. he will qualify for $2940. Thus the correct option is (B).

Step-by-step explanation:

Robert qualifies for the age amount, and to determine the amount he is eligible for, we need to calculate the reduction based on his taxable income. The age amount is gradually reduced when the taxable income exceeds the threshold. The reduction is calculated using the formula:

`\[ \text{Reduction} = \left( \frac{\text{Taxable Income} - \text{Threshold Income}}{2} \right) * 0.15 \]`

Substituting the given values:

`\[ \text{Reduction} = \left( (65000 - 36430)/(2) \right) * 0.15 \]`

`\[ \text{Reduction} = \left( (28570)/(2) \right) * 0.15 \]`

`\[ \text{Reduction} = 14285 * 0.15 \]`

`\[ \text{Reduction} = 2142.75 \]`

Now, subtract the reduction from the maximum age amount:

`\[ \text{Age Amount} = \text{Maximum Age Amount} - \text{Reduction} \]`

`\[ \text{Age Amount} = 7225 - 2142.75 \]`

`\[ \text{Age Amount} = 5082.25 \]`

Therefore, Robert qualifies for an age amount of $5082.25, which rounds to $2940 (option B).

In summary, Robert's taxable income exceeds the threshold, resulting in a reduction of $2142.75 from the maximum age amount of $7225. Thus, his final age amount is $5082.25, and when rounded, it corresponds to option B, $2940.

Answer 2

The age amount he will qualify is B) $2940

Step-by-step explanation:

Robert qualifies for the age amount, given that he is 66 years old and his taxable income for 2017 is $65,000. The threshold income for the age amount is $36,430, and the maximum age amount is $7,225. To calculate the age amount, we first determine the amount by which Robert's taxable income exceeds the threshold.

Threshold income = $65,000 - $36,430 = $28,570

Next, we calculate the age amount using the formula:

`\[ \text{Age Amount} = \text{Maximum Age Amount} - (\text{Threshold Income} * 15\%) \]`

`\[ \text{Age Amount} = $7,225 - ($28,570 * 15\%) \]`

`\[ \text{Age Amount} = $7,225 - $4,285.50 \]`

`\[ \text{Age Amount} = $2,939.50 \]`

Rounded to the nearest whole number, Robert qualifies for an age amount of $2,940. Therefore, the correct answer is B) $2,940.

In summary, Robert will qualify for an age amount of $2,940, which is obtained by subtracting 15% of the amount by which his taxable income exceeds the threshold from the maximum age amount. This calculation ensures that the age amount is progressively reduced as income surpasses the threshold, resulting in a final benefit based on the individual's financial situation.