How much income tax will jangyoun save if he chooses to

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Jangyoun is a married taxpayer with a dependant 4-year-old daughter. His employer offers a flexible spending account under which he can choose to receive cash or, alternatively, choose from certain fringe benefits. These benefits include health insurance that costs $9,000 and child care that costs $2,600. Assume Jangyoun is in the 28% tax bracket.

A) How much income tax will Jangyoun save if he chooses to participate in the employer's health insurance plan? Assume that he does not have sufficient medical expenses to itemize his deductions. 

B) Would you recommend that Jangyoun participate in the employer's health insurance plan if his wife's employer already provides comparable health insurance coverage for the family? 

C) Would you recommend that Jangyoun participate in the employer-provided child care option if he has the alternative option of claiming a child care credit of $480?

Reference no: EM13941892

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