During 2014,Mark's employer withheld $2,000 from his wages for state income tax.Mark claimed the $2,000 as an itemized deduction on his 2014 federal income tax return.His total itemized deductions for 2014 were $8,000.Mark's taxable income for 2014 was a negative $20,000 due to substantial business losses.Mark received the $2,000 as a refund from the state during 2015.What amount must Mark include in income in 2014?
A)$0
B)$1,000
C)$2,000
D)$6,000

Question

Quizplus · Accepted Answer

Since Mark's taxable income was negative, he does not owe any federal income tax for 2014, and therefore does not need to include the $2,000 state tax refund as income.

During 2014,Mark's Employer Withheld $2,000 from His Wages for State