Calculating taxable income for a married couple filing jointly. Ethan and Zoe Wilson are married and have one child. Ethan is putting together some figures so that he can prepare the Wilson’s joint 2014 tax return. He can claim three personal exemptions (including himself). So far, he’s been able to determine the following with regard to income and possible deductions:
Total unreimbursed medical expenses incurred $ 1,155
Gross wages and commissions earned 50,770
IRA contribution 5,000
Mortgage interest paid 5,200
Capital gains realized on assets held less than 12 months 1,450
Income from limited partnership 200
Job expenses and other allowable deductions 875
Interest paid on credit cards 380
Dividend and interest income earned 610
Sales taxes paid 2,470
Charitable contributions made 1,200
Capital losses realized 3,475
Interest paid on a car loan 570
Alimony paid by Ethan to his first wife 6,000
Social Security taxes paid 2,750
Property taxes paid 700
State income taxes paid 1,700
Given this information, how much taxable income will the Wilsons have in 2014? (Note: Assume that Ethan is covered by a pension plan where he works, the standard deduction of
12,400 for married filing jointly applies, and each exemption claimed is worth
3,950.)