Millicent Fairchild is a single orthopedic surgeon based in Scottsdale, Arizona, who earns a substantial salary from a hospital group and also runs a private consulting practice that generated $163,700 in net self-employment income in 2024. She received interest from a high-yield savings account, ordinary and qualified dividends from her brokerage portfolio, and realized a $3,000 net long-term capital gain from selling shares of stock. Her itemized deductions include $19,200 in state and local taxes (capped), $14,800 in mortgage interest on her primary residence, and $7,500 in charitable contributions.
Correct Answers
A G I
$467,950.00
gross Income
$469,150.00
tax Liability
$118,212.25
taxable Income
$426,450.00
refund Or Due Amount
$80,572.25
refund Or Due Direction
Balance Due
Step-by-Step Solution
TAX FORMULA — Millicent Fairchild (SINGLE) GROSS INCOME Wages: $291,800.00 Interest Income: $5,450.00 Ordinary Dividends: $5,200.00 Business Income: $163,700.00 Capital Gain: $3,000.00 = Gross Income: $469,150.00 − Above-Line Deductions: $1,200.00 = AGI: $467,950.00 DEDUCTIONS Standard Deduction (single): $14,600.00 Itemized Deductions: $41,500.00 Deduction Used: $41,500.00 (itemized) = Taxable Income: $426,450.00 TAX CALCULATION Ordinary Taxable Income: $419,350.00 Ordinary Tax: $117,147.25 LTCG + Qualified Div: $7,100.00 LTCG Tax: $1,065.00 − Credits: $0.00 = Tax Liability: $118,212.25 − Taxes Withheld: $37,640.00 = Tax Due: $80,572.25