You have a gross income of $117,151 and are filing your tax return singly. You claim one exemption and can take a deduction of $2,713 for interest on your mortgage, an adjustment of $2,791 for business losses, an adjustment of $1,346 for alimony, a deduction of $2,086 for property taxes, a deduction of $2,376 for contributions to charity, and an adjustment of $1,091 for contributions to your retirement fund. The standard deduction for a single filer is $5,700, and exemptions are each worth $3,650. What is the difference between your adjusted gross income and your taxable income?
Your itemized deductions total $2,713 + $2,086 + $2,376 = $7,175, which is greater than the $5,700 standard deduction. The difference between adjusted gross income and taxable income is therefore the $7,175 deduction plus the $3,650 exemption, or $10,825. The correct choice is $10,825.
AI-written and checked against the verified answer.