Use Worksheet 3.1

,

Use Worksheet 3.2

. Henry Zhao graduated from college in 2014 and began work as a systems analyst in July 2014. He is preparing to file his income tax return for 2014 and has collected the following financial information for calendar year 2014:

Tuition, scholarships, and grants$5,750Scholarship, room, and board1,850Salary30,250Interest income185Deductible expenses, total3,000Income taxes withheld2,600


EXHIBIT 3.3

Sample Tax Rate SchedulesTax rates levied on personal income vary with the amount of reported taxable income and the taxpayer’s filing status.

2014 Tax Rate SchedulesSchedule X

-If your filing status is

Single

If your taxable

income is:The tax is:

Over-

But not

over-of the

amount

over-0$9,075_ _ _ _ _10%$09,07536,900$907.50 + 15%9,07536,90089,3505,081.25 + 25%36,90089,350186,35018,193.75 + 28%89,350186,350405,10045,353.75 + 33%186,350405,100406,750117,541.25 + 35%405,100406,750_ _ _ _ _118,118.75 + 39.6%406,750

  1. Prepare Henry’s 2014 tax return, using a $6,200 standard deduction, a personal exemption of $3,950, and the tax rates given in Exhibit 3.3. Which tax form should Henry use, and why?
  2. Prepare Henry’s 2014 tax return using the data in part a, along with the following information:
  3. IRA contribution$5,000Cash dividends received150
  4. Which tax form should he use in this case? Why?