Check my work Required information The following information

Check my work Required information The following information applies to the questions displayed below.] Part 3 of 4 George and Weezy received $29,500 of Social Security benefits this year ($11,200 for George; $18,300 for Weezy). They also received $4,90O of interest from jointly owned City of Ranburne Bonds and dividend income. Skipped What amount of the Social Security benefits must George and Weezy include in their gross income under the following independent situations? (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount. Leave no answer blank. Enter zero if applicable.) eBook Print c. George and Weezy file married joint and receive $32,600 of dividend income from stocks owned by George. Amount to be included as taxable income

Solution

c) George and Weezy file married jointly and their modified AGI +50% of social security benefits exceed $44,000 ($4,900 interest + $32,600 dividends + [(50% of $29,500) $14,750] = $52,250), they must include in gross income the lesser of

i) 85% of their social security benefits (85% of $29,500) = $25,075 or

ii) 85% of the amount by which modified AGI plus 50% of social security benefits exceeds the limit of $44,000.

85%($4,900 interest + $32,600 dividends + [(50% of $29,500) $14,750] - $44,000) = 85% of $8,250 = $7,012.50

The lesser of the i and ii is $7,012.50.

In addition to above, they should include the lesser of

1) 6,000 or

2) 50% of social security benefits (50% of $29,500) = $14,750

the lesser of 1 and 2 is $6,000

Amount to be included as taxable income is $13,012.50 ($7,012.50+$6,000)

d) George and Weezy file married jointly and their modified AGI +50% of social security benefits exceed falls between $32,000 and $44,000 ($4,900 interest + $16,300 dividends + [(50% of $29,500) $14,750] = $35,950), they must include in gross income the lesser of

i) 50% of their social security benefits (50% of $29,500) = $14,750 or

ii) 50% of the amount by which modified AGI plus 50% of social security benefits exceeds the limit of $32,000.

50%($4,900 interest + $16,300 dividends + [(50% of $29,500) $14,750] - $32,000) = 50% of $3,950 = $1,975

The lesser of i and ii is $1,975

Amount to be included as taxable income is $1,975