Given the following information, would it be better for Illinois $52,400 Federal taxable income Federal marginal income tax rate State taxable income $39,28C State income tax rate Total sales tax paid $1,34- Assume that Salem has sufficient itemized deductions to c
Given the following information, would it be better for Illinois $52,400 Federal taxable income Federal marginal income tax rate State taxable income $39,28C State income tax rate Total sales tax paid $1,34- Assume that Salem has sufficient itemized deductions to c
Chapter5: Gross Income: Exclusions
Section: Chapter Questions
Problem 16DQ
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Transcribed Image Text:Given the following information, would it be better for Illinois resident Salem Marcos to itemize her sales tax or her state income tax on her federal tax return?
$52,400.00
25%
Federal taxable income
Federal marginal income tax rate
State taxable income
$39,280 00
3%
$1,344 80
State income tax rate
Total sales tax paid
Assume that Salem has sufficient itemized deductions to choose itemization method over the standard deduction.
It would be better for Illinois resident Salem Marcos to (Select best answer below)
O A. No difference between the two.
B. Itemize state income tax
C. Itemize sales tax.
(Round to the nearest cent.)
If she makes the effort to track the sales tax she paid, on her federal income taxes Salem Marcos could save $
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Step 1
Itemized deductions are expenditures on eligible products, services or adjusted gross income to reduce the tax invoice bill. Tax payers can take either standard deduction or itemized deduction to reduce taxable income on their federal income tax return.
Itemized deductions are listed on Schedule A of Form 1040.
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ISBN:
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Author:
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Publisher:
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