Chapter 3 Financial Planning Exercise 7 Effect of tax credit vs. tax exemption

By defining after-tax income, demonstrate the differences resulting from a $1,000 tax deduction versus a $1,000 tax credit for a single taxpayer in the 12% tax bracket with $32,000 of pre-tax income. Round your answers to two decimal places. (Use Exhibit 3.3 .)

After-tax income with tax deduction	$
After-tax income with tax credit	$