Hamad is an employee of Mountain Company.
He properly completed his Form 1040EZ tax
return and was requird to pay the IRS $1,244 at the time of filing. He had income tax withholding during the year of
$4,782. His tax liability for the year was a $1,244 b $3,538 c $4,782 d $6,026
4782 + 1244 = ?
To determine Hamad's tax liability for the year, we need to calculate the difference between his tax withholding and the amount he needed to pay to the IRS.
Tax liability = Tax withholding - Amount paid to IRS
Tax withholding = $4,782
Amount paid to IRS = $1,244
Tax liability = $4,782 - $1,244
Tax liability = $3,538
Therefore, the correct answer is b) $3,538
To determine Hamad's tax liability for the year, we need to understand the information provided.
1. Hamad completed a Form 1040EZ tax return: The Form 1040EZ is the simplest tax form used to file federal income tax returns. It is generally used by individuals with straightforward tax situations and fewer deductions or credits.
2. Hamad was required to pay the IRS $1,244 at the time of filing: This means that his total tax liability, the amount of taxes he owes for the year, is $1,244.
3. Hamad had income tax withholding of $4,782 during the year: Income tax withholding is the amount of money automatically deducted from an employee's paycheck and sent to the IRS on their behalf. This indicates that Hamad has already paid $4,782 in taxes throughout the year.
Based on this information, we can calculate Hamad's tax liability for the year by subtracting the amount of withholding from his total tax owed.
Tax liability = Total tax owed - Income tax withholding
Tax liability = $1,244 - $4,782
Since the result of this calculation is negative, it means that Hamad's tax liability for the year is $0. Hamad has already paid more in taxes through withholding ($4,782) than what he owed ($1,244), resulting in a refund of $3,538.
Therefore, the correct answer is b) $3,538.