Jamison mitchell (43) is an unmarried, head of household taxpayer with the following income for the year: wages $40,215; bank interest $170; municipal bond interest $195; lottery prize $475; gift from his father $14,000. jamison contributed $3,150 to his traditional ira, which he will deduct. what is jamison's adjusted gross income?

Explanation:

Adjusted Gross Income of an individual is the calculation of all an individuals earnings less authorised deductions.

Jamison Mitchell's Adjusted Gross Income is calculated thus:

1. Wages                                                  $40,215

2. Bank Interest                                      $170

3. Lottery Prize                                        $475

4. Municipal Bond Interest                     $195

Total Income                                             $41,055

Less: Contribution to IRA                       ($3,150)

Adjusted Gross Income                           $37,905

Please Note that Cash gift from either a father or Mother to their Child to the tune of $14,000 each is not classified as an income and so not taxable.

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