Consider the 2020 information for a single taxpayer without children:

                                                  1                                   2

wages income.....................100000.....................100000

tax free income..................3000............................3000

medical expenses.............1200..............................1200

state taxes paid..................2500............................2500

local property taxes...........4000..............................0

mortgage interest...............3100..............................0

charitable contributions....2000.............................0

a.    What is the total taxes owed under each scenario?

b.    How much did the taxpayer save in taxes under scenario A due to the charitable contribution?

c.     In each scenario, what is the effective tax rate based on AGI?

d.    In each scenario, what is the marginal tax rate?

Answer rating: 100% (QA)

ASSUMPTION The taxpayer is opting for Itemized deduction ... View the full answer