In 2019,Rita is divorced with one child.She has AGI of $20,000 resulting in a federal income tax liability of $200 and an earned income credit of $3,374.She has had $550 of federal income taxes withheld from her pay.Rita will receive a federal income refund of
A)$550.
B)$2,624.
C)$3,174.
D)$3,724.

Question

Quizplus · Accepted Answer

To calculate the refund, we need to determine Rita's total payments and credits:

Total Payments and Credits = Federal Income Tax Withheld + Earned Income Credit
Total Payments and Credits = $550 + $3,374
Total Payments and Credits = $3,924

Next, we need to determine Rita's total tax liability:

Total Tax Liability = Federal Income Tax Liability
Total Tax Liability = $200

Since Rita's total payments and credits ($3,924) are greater than her total tax liability ($200), she will receive a refund. The amount of the refund is:

Refund = Total Payments and Credits - Total Tax Liability
Refund = $3,924 - $200
Refund = $3,724

Therefore, Rita will receive a federal income refund of $3,724, which is option D.

In 2019,Rita Is Divorced with One Child