Raymond Thornton is a single freelance graphic designer based in Portland, Oregon, who earns wages from a part-time agency position while also running his own independent design studio. In addition to his earned income, Raymond holds a modest brokerage account generating qualified dividends and realized a long-term capital gain from selling appreciated stock during 2024. He pays significant mortgage interest and state income taxes that push his itemized deductions above the standard deduction threshold.
Correct Answers
A G I
$81,900.00
gross Income
$88,800.00
tax Liability
$7,519.25
taxable Income
$62,500.00
refund Or Due Amount
$50.75
refund Or Due Direction
Refund
Step-by-Step Solution
TAX FORMULA — Raymond Thornton (SINGLE) GROSS INCOME Wages: $60,100.00 Interest Income: $1,700.00 Ordinary Dividends: $3,000.00 Business Income: $9,500.00 Capital Gain: $14,500.00 = Gross Income: $88,800.00 − Above-Line Deductions: $6,900.00 = AGI: $81,900.00 DEDUCTIONS Standard Deduction (single): $14,600.00 Itemized Deductions: $19,400.00 Deduction Used: $19,400.00 (itemized) = Taxable Income: $62,500.00 TAX CALCULATION Ordinary Taxable Income: $45,250.00 Ordinary Tax: $5,198.00 LTCG + Qualified Div: $17,250.00 LTCG Tax: $2,321.25 − Credits: $0.00 = Tax Liability: $7,519.25 − Taxes Withheld: $7,570.00 = Refund: $50.75