Answered

Discover the answers you need at Westonci.ca, a dynamic Q&A platform where knowledge is shared freely by a community of experts. Experience the ease of finding accurate answers to your questions from a knowledgeable community of professionals. Join our Q&A platform to connect with experts dedicated to providing accurate answers to your questions in various fields.

Arthur files a single income tax return and his maximum tax-free interest under the education savings bond program is $6,000. How much of the interest is excludible if his modified adjusted gross income exceeds the applicable dollar limit by $5,000 (one-third of the phaseout range)?.

Sagot :

anthougo

Since Arthur's modified adjusted gross income exceeds the applicable dollar limit by $5,000, the excludable interest is only $1,000.

Data and Calculations:

Education savings bond program's maximum tax-free interest = $6,000

Excess of modified adjusted gross income = $5,000

Conditions for Excludable Interest:

1) Arthur should have paid “qualified” higher education expenses (as defined by the IRS) for himself.

2) Arthur should have a single filing status.

3) Arthur should have an adjusted gross income that does not exceed the phase out rules.

Thus, since Arthur's modified adjusted gross income exceeds the applicable dollar limit by $5,000, the excludable interest is $1,000 ($6,000 - $5,000).

Learn more about excludable interest under the education savings bond program here: https://brainly.com/question/1442514 and https://brainly.com/question/9175572

We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. We appreciate your visit. Our platform is always here to offer accurate and reliable answers. Return anytime. We're dedicated to helping you find the answers you need at Westonci.ca. Don't hesitate to return for more.