Calculation of Social Security Tax and Marginal, Average and Effective Tax Rates (LO. 1) In 2020, Rory earns $70,000 per year as a college professor, paying $5,891 in federal income taxes. Latesia is a marketing executive with a salary of $140,000 who paid $21,919 in federal taxes. In addition, Latesia collected $50,000 on a life insurance policy. Both taxpayers are single and take the 2020 standard deduction. Compute the following for the two taxpayers. Note: Round the total taxes to two decimal places. Enter percentages to one decimal. a. With respect to the FICA taxes, calculate their total FICA liability. Hint: OASDI: 6.2% with a cap of $137,700; MHI: 1.45% d. Based on the data provided, compute Rory and Latesia's effective FICA tax rate for 2020. Rory's effective tax rate: 7.65 V % Latesia's effective tax rate: X %

Calculation of Social Security Tax and Marginal, Average and Effective Tax Rates (LO. 1) In 2020, Rory earns $70,000 per year as a college professor, paying $5,891 in federal income taxes. Latesia is a marketing executive with a salary of $140,000 who paid $21,919 in federal taxes. In addition, Latesia collected $50,000 on a life insurance policy. Both taxpayers are single and take the 2020 standard deduction. Compute the following for the two taxpayers. Note: Round the total taxes to two decimal places. Enter percentages to one decimal. a. With respect to the FICA taxes, calculate their total FICA liability. Hint: OASDI: 6.2% with a cap of $137,700; MHI: 1.45% d. Based on the data provided, compute Rory and Latesia's effective FICA tax rate for 2020. Rory's effective tax rate: 7.65 V % Latesia's effective tax rate: X %

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Clayton received a $140,000 distribution from his 401(k) account this year. Assuming Clayton's marginal tax rate is 25 percent, what is the total amount of tax and penalty Shauna will be required to pay if she receives the distribution on her 62nd birthday and she has not yet retired? Group of answer choices $0 $14,000 $35,000 $49,000 None of the choices is correct.
Required information [The following information applies to the questions displayed below.] Jeremy earned $100,800 in salary and $6,800 in interest income during the year. Jeremy's employer withheld $11,000 of federal income taxes from Jeremy's paychecks during the year. Jeremy has one qualifying dependent child who lives with him. Jeremy qualifies to file as head of household and has $26,200 in itemized deductions. (Use the tax rate schedules.) b. Assume that in addition to the original facts, Jeremy has a long-term capital gain of $7,550. What is Jeremy's tax refund or tax due including the tax on the capital gain? (Round your intermediate calculations and final answer to the nearest whole dollar amount.) (1) Gross income (2) For AGI deductions (3) Adjusted gross income (4) Standard deduction (5) Itemized deductions (6) (7) Taxable income Description Greater of standard deduction or itemized deductions (8) Income tax liability (9) Child tax credit (10) Tax withholding Tax due Amount $…
Married taxpayers Otto and Ruth are both self-employed and file a joint return. Otto earns $352,000 of self-employment income and Ruth has a self-employment loss of $44,700. How much 0.9 percent Medicare tax for high-income taxpayers will Otto and Ruth have to pay with their 2020 income tax return? If required, round your final answer to nearest dollar.
Paul is single, has $62,100 of wages, and pays 20% in federal and state income tax. If the combined federal and state tax rate increases to 25%, how much additional income must Paul earn to maintain the same desired take-home pay in 2023? (Round answer to O decimal places, e.g. 5,125.) Additional income $ LA
Liam has a gross income of $120,000 and takes the standard deduction. 1) What are his total taxes due? 2) What is his marginal tax rate? 3) What is his effective tax rate? Round to the neared hundredth of a percent.
Lana Long, age 32, chief executive officer of News America borrows $100,000 from her employer as a bridge loan. Assume that the applicable federal rate for year one of the loan is 6 per cent, but that American only charges 2 percent. What are the likely tax consequences for Lana? Explain.
Data: In 2020, Elaine paid $2,160 of tuition and $900 for books for her dependent son to attend State University this past fall as a freshman. Elaine files a joint return with her husband - AGI $165,500. Question: What is the maximum American opportunity tax credit that Elaine can claim for the tuition payment and books ? Thx, Stephanie
Kana is a single wage earner with no dependents and taxable income of $168,700 in 2020. Her 2019 taxable income was $155,000 and tax liability was $31,375. Calculate Kana's 2020 income tax liability and the minimum required 2020 annual payment necessary to avoid any penalty. Round your answers to two decimal places. Click here to access the income tax rate schedules. Kana's 2020 income tax liability: Kana's minimum required 2020 annual payment necessary to avoid any penalty:
Mrs. King, a single taxpayer, earns a $68,000 annual salary and pays 15 percent in state and federal income tax. If tax rates increase so that Mrs. King's annual tax rate is 20 percent, how much additional income must Mrs. King earn to maintain the same after-tax disposable income? Additional income before tax
Earned Income Credit. Carolyn is unmarried and has one dependent child, age 6, who lives with her for the entire year. In 2015, she has income of $16,000 in wages and $6,000 in alimony. Her AGI is $22,000. a. What is Carolyn’s tentative earned income credit (before phase out)? b. what is Carolyn’s allowable earned income credit? c. If Carolyn has no income tax liability (before the earned income credit is subtracted), is she entitled to a refund in the current year? d. How will your answers to Part a and b change if Carolyn is married filing a joint return
Rey