Based on the fact that Derek does not itemize deductions, then his 2019 federal income tax is $7,540
<h3>What is the federal income?</h3>
With an AGI of $55,000, Derek is in the $40,126 to $85,525 tax bracket.
His tax is:
= $4,617.50 plus 22% of the amount over $40,125
= $4,617.50 + (22% x (50,000 - 40,125))
= $6,790
Capital gains tax:
= 5,000 x 15%
= $750
Total federal tax:
= 750 + 6,790
= $7,540
In conclusion, based on Derek's AGI and the qualified dividends, Derek's 2019 federal income tax was $7,540.
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