Question

During 2018, Sandeep had the following transactions:Salary$ 80,000Interest income on City of Baltimore bonds1,000Damages for personal injury (car accident)100,000Punitive damages (same car accident)200,000Cash dividends from Chevron Corporation stock7,000Sandeep's AGI is:

Answer 1

Answer: $287,000

Step-by-step explanation:

Based on the information, Sandeep adjusted gross income will be:

Salary $80,000

Add: Punitive damages: $200,000

Add: Cash dividends: $7000

AGI = $80,000 + $200,000 + $7000

AGI = $287,000

Note that the interest income on City of Baltimore bonds and the damages for personal injury are both non taxable exclusion and therefore aren't added.