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If profitable between tax rates is 20% then your family will save $200 for every $1,000 transferred to your “lower rate” close friend. Now we calculate if you have any income tax due. Assuming for once that not income exists, we calculate taxable income by taking the exploit the business ($20,000) and subtract standard model deduction (which is $5,950 for 2012) less the exemption deduction (which is $3,800 for 2012). The taxable income would then be $20,000 – $5,950 – $3,800 which equals $10,250.
Based on tax law the extra revenue tax due for duty would be $1,099. So, the total tax bill for this taxpayer would definitely be $1,099 + $3,060 for a total of $4,159. 
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