Please view explanation and answer below.
1
Adjusted Gross Income
Student’s Name
Institutional Affiliation
Course Name and Number
Instructor’s Name
Due Date
2
Adjusted Gross Income
Adjusted Gross Income or AGI is obtained by calculating income to determine the
measures of taxable earning and, in the process subtracting certain deductions. All incomes a
person gets are taxable unless the law excludes it from being taxable. In the case of Marlene,
Clara is legally legible to get dependent care benefits because she lives with Marlene, 67, and is
legally blind, poor of health, and receives a meager Social Security income of $3,350. If Clara
gets income from a qualified dependent benefit plan, she will be treated as an employer and
employee. It means, therefore, that her adjusted gross income will increase, taxes will also
increase because of the income, but she will be legible to get deductions from either from 1040
or 1040-SR because of taking care of a disabled person.
The amount that will be deducted from her adjusted gross income for tax includes the
total amount she will be getting from the benefits care plan in a year, total expenses incurred
taking care of the blind Marlene, and benefits from the employer. In other words, disability
benefits will be exclude…
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