Question

B, a single taxpayer with no dependents, has income and deductions for 2019 that are summarized as follows:

                                    Gross income                                          $27,100

                                    Deductions for A.G.I.                                 2,175

                                    Itemized deductions                                  11,000

                                    Non-refundable income tax credit                 300

                                    Federal income tax withheld                      1,500

      Based on these facts, what is B’s tax due or (refund) for 2019? (Note: Use the tax rate schedules on the inside back cover, even though you shouldn't when taxable income is less than $100,000. All of B’s taxable income is ordinary income).  

a.         $273 overpayment

            b.     $323 overpayment

            c.     $467 overpayment

            d.     $1627 overpayment

            e.     $1033 due

Answer 1

Option c is the correct answer

Gross Income	$ 27,100
For AGI deductions	$ -2,175
Adjusted gross income	$ 24,925
Standard Deduction	$ 12,200
Taxable income	$ 12,725
Income tax liability	$   1,333
970+(12725-9700)*12%
Non-refundable income tax credit	$     -300
Taxes (refund)	$   1,033
Federal income tax withheld	$   1,500
Overpayment	$       467