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Schedule 1, Part II: Adjustments to Income
Schedule 1, Part II: Adjustments to Income
Line 21 (Student Loan Interest): In your initial data, there was a $900 student loan interest adjustment. However, in your final correct solution, the AGI was calculated as $172,900 (the full amount of the wages). This means the student loan interest was not deducted on Line 21.
Line 26 (Total Adjustments): Since no adjustments (like student loan interest, educator expenses, or IRA deductions) were claimed in your final set of figures, the total is $0.
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Demarco and Janine Jackson have been married for 20 years and have four children who qualify as their dependents (Damarcus, Jasmine, Michael, and Candice). The Jacksons file a joint tax return. The couple received salary income of $97,500 and qualified business income of $17,500 from an investment in a partnership, and they sold their home this year. They initially purchased the home three years ago for $237,500, and they sold it for $287,500. The gain on the sale qualified for the exclusion from the sale of a principal residence. The Jacksons incurred $18,000 of itemized deductions, and they had $4,000 withheld from their paychecks for federal taxes. They are also allowed to claim a child tax credit for each of their children. However, because Candice is 18 years of age at year end, the Jacksons may claim a child tax credit for other qualifying dependents for Candice. (Use the tax rate schedules (opens in a new tab).)
Complete the 2024 federal income tax return for Bob and Melissa Grant. Include only required tax forms when completing the return. Note: The IRS forms require Adobe Reader to view and fill. Follow these IRS Instructions for Downloading and Printing PDF Files
Total W-2 wages from three employers equal $115,410, flowing directly to Line 1z.
This earned income is combined with taxable interest and annuity distributions to reach a total income of $132,415.
Part II is $0 because the taxpayers had no "above-the-line" adjustments (like student loan interest). Instead, all qualifying expenses were maximized as itemized deductions on Schedule A. Additionally, physical injury settlements are non-taxable, while the $10,000 in punitive damages is fully taxable and reported on Line 8z.
Part II is $0 because the taxpayers had no "above-the-line" adjustments (like student loan interest). Instead, all qualifying expenses were maximized as itemized deductions on Schedule A. Additionally, physical injury settlements are non-taxable, while the $10,000 in punitive damages is fully taxable and reported on Line 8z.
Schedule 2 is zero because the Grants’ income falls below the $250,000 threshold for investment and Medicare surtaxes. Additionally, they have no self-employment earnings or AMT liability for the 2025 tax year.
Schedule 2 is zero because the Grants’ income falls below the $250,000 threshold for investment and Medicare surtaxes. Additionally, they have no self-employment earnings or AMT liability for the 2025 tax year.
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