In 2019, Julia made eligible charitable donations of $50,000. Her taxable income for 2019 was $300,000....

In 2019, Julia made eligible charitable donations of $50,000. Her taxable income for 2019 was $300,000. What was her federal charitable donations tax credit?

Expert Solution

Julia Federal charitable donations tax credit = $ 16,464

Calculation:

Particulars	Deduction Rate	Tax Credit
Up to $ 200	15%	$ 30
200-50000	33%	$ 16,434
Total		$ 16,464

Notes:

1) Tax credit on donations will 15% up to $200 and any donation above $ 200 will get tax credit up to 29%.

2) But if the tax payer taxable income is subject to maximum tax rate of 33% then tax credit on donation above $200 is 33% [ 33% tax rate is applies for income above $ 210,371 ]. Here Julia taxable income is $ 300,000. So, She is eligible for 33% tax credit.

ekkarill92 answered 2 years ago

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