Michelle and Mark are married and file a joint return. Michelle owns and unincor
ID: 2381620 • Letter: M
Question
Michelle and Mark are married and file a joint return. Michelle owns and unincorporated dental practice. Mark works part-time as a high school math teacher, and spends the remainder of his time caring for their daughter. During the current year, they report the following items:
a. What is Michelle and Mark's taxable income or loss for the year?
b. What is Michelle and Mark's NOL for the year?
Item Amount Mark's salary $ 18,000 Interest earned on savings account 1,200 Interest paid on personal residence 7,100 Itemized deductions for state and local taxes 3,400 Items related to Michelle's dental practice Revenues 65,000 Payroll and salary expense 49,000 Supplies 17,000 Rent 16,400 Advertising 4,600 Depreciation 8,100 Required:a. What is Michelle and Mark's taxable income or loss for the year?
b. What is Michelle and Mark's NOL for the year?
Explanation / Answer
Taxable income
31800
Non business deductions
10700
Non business income
1200
plus
Non business income
9500
Perosnla exemptions
10200
Net operating loss
12100
Taxable income
31800
Non business deductions
10700
Non business income
1200
plus
Non business income
9500
Perosnla exemptions
10200
Net operating loss
12100