John and Sandy Ferguson got married eight years ago and have a seven-year-old daughter, Samantha. In 2020, John worked as a computer technician at a local university earning a salary of $152,000, and Sandy worked part time as a receptionist for a law firm earning a salary of $29,000. John also does some Web design work on the side and reported revenues of $4,000 and associated expenses of $750. The Fergusons received $800 in qualified dividends and a $200 refund of their state income taxes. The Fergusons always itemize their deductions, and their itemized deductions were well over the standard deduction amount last year. The Fergusons had qualifying insurance for purposes of the Affordable Care Act (ACA). Use Exhibit 8-9, Tax Rate Schedule, Dividends and Capital Gains Tax Rates 2020 AMT exemption for reference. The Fergusons reported making the following payments during the year: State income taxes of $4,400. Federal tax withholding of $21,000. Alimony payments to John's former wife of $10,000 (divorced on 12/31/2014). Child support payments for John's child with his former wife of $4,100. . $12,200 of real property taxes. Sandy was reimbursed $600 for employee business expenses she incurred. She was required to provide . $3,600 to Kid Care day care center for Samantha's care while John and Sandy worked. $14,000 interest on their home mortgage ($400,000 acquisition debt). $3,000 interest on a $40,000 home-equity loan. They used the loan to pay for a family vacation and new car $15,000 cash charitable contributions to qualified charities. Donation of used furniture to Goodwill. The furniture had a fair market value of $400 and cost $2,000. a. What is the Fergusons' 2020 federal income taxes payable or refund, including any self-employment tax and AMT, if applicable? (Round your intermediate computations to the nearest whole dollar amount.) EXHIBIT 8-9 Child and Dependent Care Credit Percentage If AGI is over But not over Then the percentage is 35% $ 0 $15,000 15,000 17,000 34 17,000 19,000 33 19,000 21,000 32 21,000 23,000 31 23,000 25,000 30 25,000 27,000 29 27,000 29,000 28 29,000 27 31,000 33,000 31,000 26 33,000 25 24 35,000 37,000 35,000 37,000 39,000 41,000 43,000 23 22 39,000 41,000 21 43,000 No limit 20 Schedule X-Single If taxable income is over: But not over: $ 0 $ 9,875 $ 9,875 $ 40,125 $ 40,125 $ 85,525 $ 85,525 $163,300 $163,300 $207,350 $207,350 $518,400 $518,400 The tax is: 10% of taxable income $987.50 plus 12% of the excess over $9,875 $4,617.50 plus 22% of the excess over $40,125 $14,605.50 plus 24% of the excess er $85,525 $33,271.50 plus 32% of the excess over $163,300 $47,367.50 plus 35% of the excess over $207,350 $156,235 plus 37% of the excess over $518,400 Schedule Y-1-Married Filing Jointly or Qualifying Widow(er) If taxable income is over: But not over: The tax is: $ 0 $ 19,750 10% of taxable income $ 19,750 $ 80,250 $1,975 plus 12% of the excess over $19,750 $ 80,250 $171,050 $9,235 plus 22% of the excess over $80,250 $171,050 $326,600 $29,211 plus 24% of the excess over $171,050 $326,600 $414,700 $66,543 plus 32% of the excess over $326,600 $414,700 $622,050 $94,735 plus 35% of the excess over $414,700 $622,050 $167,307.50 plus 37% of the excess over $622,050 Schedule Z-Head of Household If taxable income is over: But not over: $ 0 $ 14,100 $ 14,100 $ 53,700 $ 53,700 $ 85,500 $ 85,500 $163,300 $163,300 $207,350 $207,350 $518,400 $518,400 The tax is: 10% of taxable income $1,410 plus 12% of the excess over $14,100 $6,162 plus 22% of the excess over $53,700 $13,158 plus 24% of the excess over $85,500 $31,830 plus 32% of the excess over $163,300 $45,926 plus 35% of the excess over $207,350 $154,793.50 plus 37% of the excess over $518,400 Schedule Y-2-Married Filing Separately If taxable income is over: But not over: The tax is: $ 0 $ 9,875 10% of taxable income $ 9,875 $ 40,125 $987.50 plus 12% of the excess over $9,875 $ 40,125 $ 85,525 $4,617.50 plus 22% of the excess over $40,125 $ 85,525 $163,300 $14,605.50 plus 24% of the excess over $85,525 $163,300 $207,350 $33,271.50 plus 32% of the excess over $163,300 $207,350 $311,025 $47,367.50 plus 35% of the excess over $207,350 Tax Rates for Net Capital Gains and Oualified Dividends . Tax Rates for Net Capital Gains and Qualified Dividends Rate 0% 15% Married Filing Jointly $0 - $80,000 $80,001 - $496,600 $496,601 Married Filing Separately SO - $40,000 $40,001 - $248,300 $248,301+ Taxable Income Single $0 - $40,000 $40,001 - $441.450 $441451+ Head of Household SO - $53,600 $53,601 - $469,050 $469,051+ Trusts and Estates $0 - $2,650 $2.651 - $13,150 $13.151+ 20% EXHIBIT 8-5 2020 AMT Exemptions Filing Status Exemption Phase-Out Begins at This Level of AMTI $1,036,800 Phase-Out Complete for This Level of AMTI $1,490,400 745,200 Married filing jointly Married filing separately Head of household and single $113,400 56,700 72,900 518,400 518,400 810,000