figuring the taxable amount?

Vote for figuring the taxable amount?
0
301 Views
Fatri Nesimi

Mr. and Mrs. A, both age 72, file a joint tax return. They each received $7,500 social security benefits. In addition, they received taxable pensions of $12,000 for Mr. A and $6,000 for Mrs. A. What is the taxable amount of the social security benefits received by the A if the base amount for MFJ is $32,000?

$15,000.00
$7,500.00
$3,750.00
$0.00

Expert Level Question
Comments
Please login or register to comment on a question.

3 Answer(s)

Vote for this anser to figuring the taxable amount?
1
This answer is marked correct for question figuring the taxable amount?
Jim Blankenship

The answer is zero, because the provisional income (MAGI plus half of ss bene's) is less than the base of $32,000 ($12k + $6k + (50%*15k) = $25.5k)


Comments
Vote for this anser to figuring the taxable amount?
0
Peter Rait

0


Comments
what is the logic behind it that the taxable amount is zero? can u please explain? is it because the 12k 6k=18k less than 32 K?
Posted by Fatri on 05/23/2012 @ 5:37 AM
Vote for this anser to figuring the taxable amount?
0
William goff

0

Tthe answer is zero because:

(12k+6K) plus the 15k in social security = $33k

basis is 32k so it would be 1k but look at their age and it reduces it to zero becuase of the extra reduction for their age.


Comments
No, there is not additional reduction based on the age of the taxpayer when figuring the taxable portion of Social Security benefits. Also, only half of the benefits (i.e. half of $15,000) are included when calculating whether the provisional income is more than the base amount.
Posted by Laurence on 05/25/2012 @ 1:54 PM

Report the question for review or moderation

IRS Circular 230 Disclosure

Pursuant to the requirements of the Internal Revenue Service Circular 230, we inform you that, to the extent any advice relating to a Federal tax issue is contained in this communication, including in any attachments, it was not written or intended to be used, and cannot be used, for the purpose of (a) avoiding any tax related penalties that may be imposed on you or any other person under the Internal Revenue Code, or (b) promoting, marketing or recommending to another person any transaction or matter addressed in this communication.

The Best Strategy

CPA Exam Guide + Test Bank + Unlimited Exams
CPA AUD, FAR, REG, & BEC Study Guides, Free Test Bank, & Unlimited Practice Exams

Want to pass the CPA exam the first time? Try a course like no other...

The Best RTRP CPE

Try Our FREE RTRP CPE
Quality Registered Tax Return Preparer Continuing Professional Education (RTRP CPE)

FFA's RTRP CPE is easy to use, entertaining, and unlike any education you've experienced before.

Enrolled Agent Affliated Schools