In 2020, Sally Martin’s taxable income was $65,000. She contributes $6,000 to a traditional IRA. She is a single woman who lives in South Dakota, a state that does not impose state income tax and owns some dividend stocks that produce $3,600 per year. Before moving to her new place, Sally was a dentist and receives a pension of $12,000 per year. Unfortunately, Sally was involved in a car accident during the year that cost her $7,000 in medical and dental expenses. However, she was so grateful to survive the accident that she decided to donate $1,000 to charity. She has no state and local taxes, no mortgage interest, and no casualty and theft loss. What is Sally’s 2020 Federal Income Tax?

Calculate the federal income tax owed; thoroughly show and document your work. Cite relevant sources. Be sure to note if you used the standard deduction or the itemized deduction when calculating her taxes, and explain why.

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