Sarah is single and has three children, ages 3, 6, and 8, whom she can claim as dependents (qualifying children). Her financial records show the following items for the current tax year: Income Source Birthday gift from parents Amount $8,000 Salary from ABC Corp (Box 1 wages) $42,000 Inheritance from grandparent $25,000 What is Sarah's taxable income for federal income tax purposes? a. $23,650 b. $42,000 c. $75,000 d. $56,650

Sarah is single and has three children, ages 3, 6, and 8, whom she can claim as dependents (qualifying children). Her financial records show the following items for the current tax year: Income Source Birthday gift from parents Amount $8,000 Salary from ABC Corp (Box 1 wages) $42,000 Inheritance from grandparent $25,000 What is Sarah's taxable income for federal income tax purposes? a. $23,650 b. $42,000 c. $75,000 d. $56,650

Microeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506893

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter15: Income Inequality And Poverty

Section: Chapter Questions

Problem 7CQ

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