Paul, a calendar year married taxpayer, files a joint return for 2012. Information for 2012 includes the following: Paul's allowable itemized deductions for 2012 are:
A)$13,500.
B)$32,400.
C)$39,200.
D)$42,200.
E)None of the above.

Question

Paul, a calendar year married taxpayer, files a joint return for 2012. Information for 2012 includes the following:  Paul's allowable itemized deductions for 2012 are:
A)$13,500. 
B)$32,400. 
C)$39,200. 
D)$42,200. 
E)None of the above.

Quizplus · Accepted Answer

We are given Paul's taxable income ($120,000), and told that he is a calendar year married taxpayer filing a joint return. Using the 2012 tax brackets and standard deduction for married couples, we can find that Paul's standard deduction would be $11,900. Therefore, his allowable itemized deductions would be the amount that exceeds the standard deduction. $120,000 - ($11,900 + $95,100) = $13,000. However, we also know that Paul had $26,200 in taxes, which are deductible on Schedule A as well. Therefore, his total itemized deductions are $13,000 + $26,200 = $39,200, making choice (C) the correct answer.

Paul, a Calendar Year Married Taxpayer, Files a Joint Return