Mr & Mrs Tsayong Are Both Over 66 Years of Age and Age

question 117

Multiple Choice

Mr. & Mrs. Tsayong are both over 66 years of age and are filing a joint return. Their income this year consisted of the following: $$\begin{array} { | l | r | } \hline \text { Taxable interest income } & \$ 10,000 \\\hline \text { Taxable pension } & 16,000 \\\hline \text { Total Social Security benefits } & 20,000 \\\hline \text { Tax-exempt interest } & 5,000 \\\hline\end{array}$$ They did not have any adjustments to income. What amount of Mr. & Mrs. Tsayongs Social Security benefits is taxable this year?

• A) $0
• B) $4,500
• C) $10,000
• D) $20,000

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Definitions:

Interest Rate

The price, in terms of a percentage of the principal, that a borrower needs to pay a lender to utilize their financial resources.

Bond's Price

The market price for which a bond is bought or sold, influenced by factors like interest rates, the bond's credit quality, and its maturity date.

Market Value Basis

The valuation of assets or securities based on the current market prices as opposed to historical costs or theoretical values.

Coupon Rate

The interest rate stated on a bond when it's issued, which represents the annual interest payment made by the issuer relative to the bond's face value.