Keith and Nicole Are Married Filing Joint with Two Daughters

question 102

Essay

Keith and Nicole are married filing joint with two daughters who qualify as dependents. Their gross income for 2014 is $21,000. Are they required to file a tax return? How do you know this without memorizing the gross income thresholds? In 2014, the standard deduction for taxpayers filing a joint return is $12,400 and the personal exemption is $3,950.

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Definitions:

Federal Deficit

The financial shortfall when a government's expenditures exceed its revenues within a given fiscal year, leading to the need for borrowing and debt accumulation.

Economic Recovery

The phase following a period of economic downturn or recession, characterized by a gradual improvement in the health of an economy, marked by increases in employment, consumer spending, and overall economic growth.

Robert Rubin

An American economist and banking executive who served as the 70th United States Secretary of the Treasury during the Clinton administration.

Wall Street

A street in lower Manhattan that is home to the New York Stock Exchange and represents the heart of the financial district and the world of American financial markets.