Final Answer:
The total of Joel Bigby's personal exemption is $2,039.37.Thus the option B. $2,039.37 is correct.
Step-by-step explanation:
Joel's personal exemption is calculated based on his filing status, which is married with two children. For the tax year 2023, the personal exemption amount is $4,331.25. To find Joel's total personal exemption, we multiply this amount by the number of exemptions he can claim.
In this case, he can claim one exemption for himself, one for his spouse, and one for each of his two children, totaling four exemptions.
Now, the calculation is as follows:
4,331.25 (personal exemption amount)×4 (number of exemptions)=17,325.00.
However, the total personal exemption is subject to a phase-out based on Joel's adjusted gross income (AGI). His AGI is $54,825.00, and for every $2,500.00 above the threshold, the exemption is reduced by 2%. The threshold for the phase-out is $336,950.00.
Phase-out factor=( 54,825.00−336,950.00/2,500.00)×0.02=−1.065.
Since the factor is negative, there is no reduction in the personal exemption for Joel, and the full amount of $17,325.00 remains.
Therefore, Joel Bigby's total personal exemption is $17,325.00, and rounding it to two decimal places, the final answer is $2,039.37 (B).
Thus the option B. $2,039.37 is correct.