Each of the following statements is correct with respect to the farm optional method of computing self-employment tax EXCEPT: (A) If gross farm income is $8,460 or less, self-employment tax may be computed on the amount of gross farm income. (B) If gross farm income is $8,460 or less, a farmer can elect the optional method, regardless of the amount of net farm income. (C) If gross farm income is more than $8,460, a farmer can elect the optional method if net farm income is less than $6,107. (D) If gross farm income is more than $8,460 and net farm income is less than $6,107, self-employment tax, using the optional method, is computed on $8,460.
Each of the following statements is correct with respect to the farm optional method of computing self-employment tax EXCEPT: (A) If gross farm income is $8,460 or less, self-employment tax may be computed on the amount of gross farm income. (B) If gross farm income is $8,460 or less, a farmer can elect the optional method, regardless of the amount of net farm income. (C) If gross farm income is more than $8,460, a farmer can elect the optional method if net farm income is less than $6,107. (D) If gross farm income is more than $8,460 and net farm income is less than $6,107, self-employment tax, using the optional method, is computed on $8,460.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Each of the following statements is correct with respect to the farm optional method of computing self-employment tax EXCEPT:
(A) If gross farm income is $8,460 or less, self-employment tax may be computed on the amount of gross farm income.
(B) If gross farm income is $8,460 or less, a farmer can elect the optional method, regardless of the amount of net farm income.
(C) If gross farm income is more than $8,460, a farmer can elect the optional method if net farm income is less than $6,107.
(D) If gross farm income is more than $8,460 and net farm income is less than $6,107, self-employment tax, using the optional method, is computed on $8,460.
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