In preparing his current year Federal income tax return, Sam, whose filing status is single, incorrectly took a deduction for medical expenses in the amount of $20,000 as an above-the-line deduction on Schedule C instead of a below- the-line deduction on Schedule A. As a result of this mistake Sam's AGI is $80,000 and his itemized deductions are $30,000. If properly taken the Schedule A medical expense deduction is subject to a 7.5% floor. Which of the following statements is correct? O Sam's correct taxable income is $50,000. O Sam's correct taxable income is $38,000. O The error results in taxable income being understated. The error results in taxable income being overstated. O The error has no effect on taxable income