Tim is a single, cash-method taxpayer with an AGI of $50,000. In April of this year, Tim paid $1,020 with his state income tax return forthe previous year. During the year, Tim had $5,400 of state income tax and $18,250 of federal income tax withheld from his salary. Inaddition, Tim made estimated payments of $1,360 and $1,900 for state and federal income taxes, respectively. Finally, Tim expects toreceive a refund of $500 for state income taxes when he files his state tax return for this year in April next year. What is the amount oftaxes that Tim can deduct as an itemized deduction?Deductible taxes18,250

Step 1 An itemized deduction is an expense that can be subtracted from adjusted gross income (AGI)…

Answered: receive a refund of $500 for state…

receive a refund of $500 for state income taxes when he files his state taxes that Tim can deduct as an itemized deduction?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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