Effect of tax credit versus tax exemption

Explain and calculate the differences resulting from a $500 tax credit versus a $500 tax deduction for a single taxpayer with $44,000 of pre-tax income. The standard deduction in 2018 was $12,000 for single. Note that personal exemptions were suspended for 2018. Use Exhibit 3.3 to determine the corresponding tax rate. Round the answers to the nearest cent.

After-tax Income (Tax Deduction)	$
After-tax Income (Tax Credit)	$

Exhibit 3.3:

Single
Taxable Income	Tax Rate
$0 - $9,525	10% of taxable income
$9,526-$38,700	$952.50 plus 12% of the amount over $38,700
$38,701 - $82,500	$4,453.50 plus 22% of the amount over $82,500