In 2022, Jeremy and Celeste, who file a joint return, paid the following amounts for their daughter, Alyssa, to attend the University ofColorado during academic year 2022-2023. Alyssa was in her first year of college and attended full-time.Tuition and fees (for fall semester 2022)Tuition and fees (for spring semester 2023)Required booksRoom and board$2,2701,1951,4801,650The spring semester at the University of Colorado begins in January. In addition to the above, Alyssa's uncle Devin sent $550 for hertuition directly to the University. Jeremy and Celeste have modified AGI of $170,000.Required:What is the amount of qualifying expenses for the purposes of the American Opportunity Tax credit (AOTC) in tax year 2022? What isthe amount of qualifying expenses and the amount of AOTC that Jeremy and Celeste can claim based on their AGI?Qualifying expenses for the AOTCAOTC claimableAmounts

To determine the amount of qualifying expenses for the American Opportunity Tax Credit (AOTC) and…

Answered: The spring semester at the University…

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter7: Tax Credits

Section: Chapter Questions

Problem 8MCQ

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Paul Barrone is a graduate student at State University. His 10-year-old son, Jamie, lives with him, and Paul is Jamies sole support. Pauls wife died in 2018, and Paul has not remarried. Paul received 320,000 of life insurance proceeds (related to his wifes death) in early 2019 and immediately invested the entire amount as shown below. Paul had 42,000 of taxable graduate assistant earnings from State University and received a 10,000 scholarship. He used 8,000 of the scholarship to pay his tuition and fees for the year and 2,000 for Jamies day care. Jamie attended Little Kids Daycare Center, a state-certified child care facility. Paul received a statement related to the Green bonds saying that there was 45 of original issue discount amortization during 2019. Paul maintains the receipts for the sales taxes he paid of 735. Paul lives at 1610 Cherry Lane, Bradenton, FL 34212, and his Social Security number is 111-11-1111. Jamies Social Security number is 123-45-6789. The university withheld 2,000 of Federal income tax from Pauls salary. Paul is not itemizing his deductions. Part 1Tax Computation Compute Pauls lowest tax liability for 2019. Part 2Tax Planning Paul is concerned because the Green bonds were worth only 18,000 at the end of 2019, 5,000 less than he paid for them. He is an inexperienced investor and wants to know if this 5,000 is deductible. The bonds had original issue discount of 2,000 when he purchased them, and he is curious about how that affects his investment in the bonds. The bonds had 20 years left to maturity when he purchased them. Draft a brief letter to Paul explaining how to handle these items. Also prepare a memo for Pauls tax file.
Joan, a single mother, has AGI of $61,500 in 2019. In September 2019 , she pays $5,000 in qualified tuition for her dependent son who just started at Big University. What is Joan's American Opportunity credit for 2019? $0 $1,250 $2,125 $2,500 Some other amount

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The spring semester at the University of Colorado begins in January. In addition to the above, Alyssa's uncle Devin sent $550 for her tuition directly to the University. Jeremy and Celeste have modified AGI of $170,000.