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Question
If your net earned income is 20,000, what tax will I have to pay AND how much EITC if there are no children?
AI accountant’s answer:
Assuming you are filing as single and have no children for the tax year 2022, the tax calculation and Earned Income Tax Credit (EITC) are as follows: 1. To determine your federal income tax, first, you need to subtract the standard deduction from your net earned income. The standard deduction for single taxpayers in 2022 is $12,950. Net earned income: $20,000 Standard deduction: -$12,950 Taxable income: $7,050 For 2022, a single taxpayer with a taxable income of $7,050 falls within the 10% tax bracket, so the federal income tax owed would be 10% of $7,050, which is $705. 2. For the Earned Income Tax Credit (EITC), the maximum credit amount in 2022 for a single taxpayer with no children is $543. However, the exact credit amount depends on your earned income and filing status. You may use the IRS EITC Assistant tool (https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/use-the-eitc-assistant) to determine the specific EITC amount you are eligible for. In summary, based on the information provided, you would owe $705 in federal income tax, and your EITC amount may be up to $543 if you qualify. Be sure to check the specific EITC eligibility requirements before claiming the credit.
Comment from reviewer
Jacques Seys, CPA

Some very slight differences in amounts from 2022 tax tables ($708 instead of $705 for federal tax due and $541 instead of $543 for earned income tax credit) which did not affect the remainder of the answer.

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