Question

Melvin Crane is 66 years old, and his wife, Matilda, is 65. They filed a joint income tax return for 2019, reporting an adjusted gross income of $22,200, on which they owed a tax of $61. They received $3,000 from Social Security benefits in 2019. How much can they claim on Form 1040 in 2019, as a credit for the elderly?

Answer 1

$0

Step-by-step explanation:

the credit for the elderly is the lesser of the following:

1) taxes owed = $61

2) you calculate the credit for the elderly by subtracting $7,500 - $3,000 (social security benefits) = $4,500

then you subtract half of your AGI over $10,000 = ($22,000 - $10,000) x 50% = $5,500

the credit = $4,500 - $5,000 = $0 (there are no negative tax credits)

the lesser between $61 and $0 is $0.