Question

Dan has AGI of $50,000 and paid the following taxes during this tax year. State income tax withholding $ 1,300 State income tax estimated payments 740 Federal income tax withholding 3,100 Social Security tax withheld from wages 1,940 State excise tax on liquor 420 Automobile license (based on the car’s weight) 310 State sales tax paid 480 Calculate how much Dan can deduct for taxes as an itemized deduction this year.

Answer 1

$2,040

Step-by-step explanation:

Given that,

AGI = $50,000

State income tax withholding = $1,300

State income tax estimated payments = 740

Federal income tax withholding = 3,100

Social Security tax withheld from wages = 1,940

State excise tax on liquor = 420

Automobile license = 310

State sales tax paid = 480

Automobile license is not deductible since it is based on the weight and not on the value.

Therefore,

Deductible taxes:

= State income tax withholding + State income tax estimated payments

= $1,300 + $740

= $2,040