State and Local Income Taxes
Response to the following problem:
In April, 2014, Jose filed his 2013 federal and state income tax returns. He paid $800 with his federal return and $450 when he filed his state income tax return. During 2014, Jose's employer withheld $6,600 and $3,100, respectively for federal and state income taxes. Jose files as single
a. What amount can Jose deduct as an itemized deduction on his 2014 tax return?
b. When Jose files his 2014 tax returns early in 2015, he receives a $90 refund from the federal government and $120 back from the state. Discuss the tax consequences to Jose of receiving refunds totaling $210. Jose's other itemized deductions in 2014 totaled $3,150.
c. Same as in Part b. except that Jose's other itemized deductions total $1,000.