Question

Carmen Reyes worked part-time last year while attending college and earned $4,288. The total withholding taxes she paid were $450. Carmen also earned $78 in interest and $16 in dividends. How much tax refund should she receive?

a) $4,594
b) $4,238
c) $4,088
d) $4,824

Answer 1

Carmen should receive a tax refund of $3,932.

Step-by-step explanation:

To calculate the tax refund, we need to subtract the total withholding taxes paid from the total income earned. Carmen earned $4,288 in part-time work, and paid $450 in withholding taxes. In addition, Carmen earned $78 in interest and $16 in dividends, which need to be included in her total income.

So, total income = part-time earnings + interest + dividends = $4,288 + $78 + $16 = $4,382.

Next, we subtract the total withholding taxes from the total income to calculate the tax refund: Tax refund = total income - total withholding taxes = $4,382 - $450 = $3,932.

Therefore, Carmen should receive a tax refund of $3,932.