Tarik,a single taxpayer,has AGI of $55,000 which includes $1,000 of qualified dividends.Tarik has $7,000 of itemized deductions.What is his 2015 federal income tax?
A)$6,544
B)$6,694
C)$7,694
D)$6,794

Question

Quizplus · Accepted Answer

To calculate Tarik's federal income tax for 2015, we first need to determine his taxable income.

AGI: $55,000 
- Standard deduction (single): $6,300 
- Personal exemption: $4,000 
- Itemized deductions: $7,000 
= Taxable income: $37,700

Next, we need to determine the tax on that taxable income.

For the first $9,225: 
10% tax = $922.50

For the amount between $9,225 and $37,700: 
15% tax = ($37,700 - $9,225) x 0.15 = $4,043.25

Tarik also has $1,000 of qualified dividends, which are taxed differently than ordinary income. The qualified dividends tax rate for taxpayers in the 15% marginal tax bracket is 0%, so Tarik's tax on his qualified dividends is $0.

Adding the taxes together: 
$922.50 + $4,043.25 + $0 = $4,965.75

Therefore, Tarik's federal income tax for 2015 is $6,694 (taxes + qualified dividends tax).

Tarik,a Single Taxpayer,has AGI of $55,000 Which Includes $1,000 of Qualified