Question

Montague (age 15) is claimed as a dependent by his parents, Matt and Mary. In 2019, Montague received $5,200 of qualified dividends, and he received $1,000 from a part-time job. What is his taxable income for 2019?

Answer 1

Answer: $4850

Explanation:

To calculate the federal income tax for Montague who is a dependent child, we should note that will the standard deduction that is allowable will be the one that is greater between paying $1,050 or the value of the earned income plus $350, but not exceeding $12,000.

This will then be calculated as:

Dividend = $5200

Add: Income from Part time job = $1000

Less: $1000 + $350 = $1350

Taxable income = $4850