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modified adjusted gross income5 plus one-half of her Social
Security benefits exceeds certain threshold amounts. In the case
of a head of household return, when this sum exceeds $25,000, the
lesser of 50 percent of such excess or 50 percent of the Social
Security benefits must be included in gross income. Sec.
86(a)(1), (c)(1)(A).
Petitioner’s reported modified adjusted gross income for
2003 was $18,349.6 As found above, petitioner must include
$2,800 in gambling winnings in her gross income, which increases
her modified adjusted gross income to $21,149. The sum of
petitioner’s modified adjusted gross income and half of her
Social Security disability benefits7 equals $26,305. Because
this amount exceeds $25,000, we hold that petitioner must include
$653 of her Social Security benefits in her gross income for
2003.8 See sec. 86(a)(1), (c)(1)(A).
5 As applicable to the instant case, modified adjusted
gross income is the taxpayer’s adjusted gross income plus
deductions for qualified tuition and related expenses. Sec.
86(b)(2)(A); see also sec. 222.
6 Petitioner reported adjusted gross income of $15,349, to
which her $3,000 deduction for qualified tuition and related
expenses was added to determine her modified adjusted gross
income. See sec. 86(b)(2)(A).
7 Half of petitioner’s Social Security benefit ($10,312 in
total) equals $5,156.
8 $26,305 less $25,000 equals $1,305. Fifty percent of
$1,305 equals $652.50.
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