1. Consider the 2020 information for a single taxpayer without children:Situation ASituation BWage IncomeTax free intertest incomeMedical expenses paidState income taxes paid85,000105,0002,2002,2007,9503,8004503,800Local property taxes paidMortgage Interest paidCharitbale contributions4,0005,1002,900480a. What is the total taxes owed under each scenario?b. In each scenario, what is the effective tax rate based on Taxable income?In each scenario, what is the marginal tax rate?C.

a. Following is the calculation of total taxes owed under each scenario: Therefore,

1. Consider the 2020 information for a single taxpayer without children: Situation A Situation B Wage Income Tax free intertest income 85,000 105,000 2,200 2,200 7,950 3,800 Medical expenses paid State income taxes paid Local property taxes paid Mortgage Interest paid Charitbale contributions 450 3,800 4,000 5,100 2,900 480 a. What is the total taxes owed under each scenario? b. In each scenario, what is the effective tax rate based on Taxable income? C. In each scenario, what is the marginal tax rate?

1. Consider the 2020 information for a single taxpayer without children: Situation A Situation B Wage Income Tax free intertest income 85,000 105,000 2,200 2,200 7,950 3,800 Medical expenses paid State income taxes paid Local property taxes paid Mortgage Interest paid Charitbale contributions 450 3,800 4,000 5,100 2,900 480 a. What is the total taxes owed under each scenario? b. In each scenario, what is the effective tax rate based on Taxable income? C. In each scenario, what is the marginal tax rate?

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter12: Alternative Minimum Tax

Section: Chapter Questions

Problem 24CE

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