Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $90,000 of business income from WCC for the year. Jacob’s marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. (Round your intermediate calculations to the nearest whole dollar amount.)

Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $90,000 of business income from WCC for the year. Jacob’s marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. (Round your intermediate calculations to the nearest whole dollar amount.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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[The following information applies to the questions displayed below.] Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $80,000 of business income from WCC for the year. Jacob's marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. Note: Round your intermediate calculations to the nearest whole dollar amount. b. What is the amount of tax Jacob will owe on the income allocation if the income is qualified business income (QBI) and Jacob qualifies for the full QBI deduction?
Leonardo, who is married but files separately, earns $80,200 of taxable income. He also has $15,200 in city of Tulsa bonds. His wife, Theresa, earns $50,200 of taxable income. If Leonardo earned an additional $30,200 of taxable income this year, what would be the marginal tax rate on the extra income for 2020? (Use tax rate schedule.) (Round your final answer to two decimal places.) Multiple Choice O 22.02 percent 18.83 percent 24.02 percent 23.65 percent None of the choices are correct
sabel, a calendar-year taxpayer, uses the cash method of accounting for her sole proprietorship. In late December she received a $41,000 bill from her accountant for consulting services related to her small business. Isabel can pay the $41,000 bill anytime before January 30 of next year without penalty. Assume her marginal tax rate is 37 percent this year and next year, and that she can earn an after-tax rate of return of 6 percent on her investments. Required: What is the after-tax cost if Isabel pays the $41,000 bill in December? What is the after-tax cost if Isabel pays the $41,000 bill in January? Use Exhibit 3.1. Note: Round your answer to the nearest whole dollar amount. Based on requirements a and b, should Isabel pay the $41,000 bill in December or January?
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Check my work. Bill and Mary filed a joint Federal income tax return this year. Mary owns a 30% interest in MAJIC Partnership, a women’s dress boutique. Mary’s share of the partnership’s net income is $280,000. Her shares of the partnership’s W–2 wages and unadjusted basis of depreciable property are $100,000 and $300,000, respectively. Mary’s share of the partnership income is $280,000 * 20% = $56,000 50% of W-2 wages is $100,000*.5= $50,000 25% of W-2 wages plus 2.5% of adjusted basis of depr prop = $100,000 * 25% +$300,000 * 2.5% =$32,500 The QBI deduction is $50,000 per the limitation phase What is the maximum QBI deduction if MAJIC’s income was from qualified services and Bill and Mary’s total taxable income was $450,000? The QBI deduction can be used for qualified service businesses only if the taxable income before the QBI deduction does not exceed the threshold. Since MAJIC’s…
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Joyce, a single parent, lives in an apartment with her two minor children (ages 8 and 10), whom she supports. Joyce earns $33,000 during 2023. She uses the standard deduction and files as a head of household. Round all computations to the nearest dollar. Click to access Earned Income Credit and Phaseout Percentages Table and the Tax Rates Schedules. a. Calculate the amount, if any, of Joyce's earned income credit. 2,696 X b. During the year, Joyce is offered a new job that has greater future potential than her current job. If she accepts the job offer, her earnings for the year will be $40,400; however, she is afraid she will not qualify for the earned income credit. Determine the increase or decrease in Joyce's net cash flow if she accepts the new job. Since the child tax credit will be the same under either scenario, you can ignore it for purposes of this analysis. Use the Tax Rate Schedule when computing her income tax. Tax calculation: Salary Less: Standard deduction Taxable income…
Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $75,000 of business income from WCC for the year. Jacob's marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. Note: Round your intermediate calculations to the nearest whole dollar amount. a. What is the amount of tax Jacob will owe on the income allocation if the income is not qualified business income? b. What is the amount of tax Jacob will owe on the income allocation if the income is qualified business income (QBI) and Jacob qualifies for the full QBI deduction? 30600 and 25050 IS NOT CORRECT!!!!!!
Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $75,000 of business income from WCC for the year. Jacob's marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. Note: Round your intermediate calculations to the nearest whole dollar amount. a. What is the amount of tax Jacob will owe on the income allocation if the income is not qualified business income? b. What is the amount of tax Jacob will owe on the income allocation if the income is qualified business income (QBI) and Jacob qualifies for the full QBI deduction? PLEASE DO NOT RESPOND WITH a) 30,600 and b) 25,050 IS NOT CORRECT!!!!!! IT IS INCORRECT.
Jacob is a member of WCC (an LLC taxed as a partnership). Jacob was allocated $90,000 of business income from WCC for the year. Jacob's marginal income tax rate is 37 percent. The business allocation is subject to 2.9 percent of self-employment tax and 0.9 percent additional Medicare tax. a. What is the amount of tax Jacob will owe on the income allocation if the income is not qualified business income? b. What is the amount of tax Jacob will owe on the income allocation if the income is qualified business income (QBI) and Jacob qualifies for the full QBI deduction?