JDD Corporation provides the following benefits to its employee, Ahmed (age 48):DescriptionSalaryHealth insuranceDental insuranceLife insuranceDependent careProfessional duesPersonal use of company jetAmount$ 344,00013,7004,2003,6004,400520227,000The life insurance is a group-term life insurance policy that provides $273,000 of coverage for Ahmed. Assuming Ahmed is subject toa marginal tax rate of 32 percent, what is his after-tax benefit of receiving each of these benefits? (Use EXHIBIT 12-8.)Note: Enter all amounts as positive values. Round your intermediate computations and final answers to the nearest whole dollar.DescriptionTaxable benefitsAmountSalaryPersonal use of company jetLife insurance (taxable portion)$ 344,000227,000Taxable totalMarginal tax rateIncome tax on benefitsAfter-tax benefit of taxable itemsNontaxable benefits$ 571,00032 %

To calculate Ahmed's after-tax benefit of receiving each of these benefits, we first need to…

Answered: JDD Corporation provides the following…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter4: Income Exclusions

Section: Chapter Questions

Problem 41P

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Rachel receives employer provided health insurance. The employer's cost of the health insurance is $6,200 annually. What is her employee's after-tax cost of providing the health insurance, assuming that the employer's marginal tax rate is 21 percent and is profitable?
39. Annie is covered by a $200,000 group-term life insurance policy of which her daughter is the sole beneficiary. Annie's employer pays the entire premium for the policy, for which the uniform premium table factor is $0.75 per $1,000 per month of coverage. How much, if any, of the cost of the group-term life insurance is included in Annie's gross income on an annual basis? a. $0. b. $450. c. $1,350. d. $1,800.
Smithers is a self-employed individual who earns $27,000 per year in self-employment income. Smithers pays $1,850 in annual health insurance premiums (not through an exchange) for his own medical care. In each of the following situations, determine the amount of the deductible health insurance premium for Smithers before any AGI deduction and where the premiums are deductible. Problem 6-28 Part-a (Algo) a. Smithers is single and the self-employment income is his only source of income. b. Smithers is single, but besides being self-employed, Smithers is also employed part time by SF Power Corporation. This year Smithers elected not to participate in SF's health plan. c. Smithers is self-employed and is also married. Smithers’s spouse, Samantha, is employed full time by SF Power Corporation and is covered by SF’s health plan. Smithers is not eligible to participate in SF's health plan.…
Addison Parker (Social Security number 123-45-6785), single and age 32, lives at 3218 Columbia Drive, Spokane, WA 99210. She is employed as regional sales manager by VITA Corporation, a manufacturer and distributor of vitamins and food supplements. Addison is paid an annual salary of 83,000 and a separate travel allowance of 28,000. In order to access the travel allowance, VITA requires adequate accounting by Addison. Addison participates in VITAs contributor) health and 401(k) plans. During 2019, she paid 4,500 for her share of the medical insurance and contributed 11,000 to the 401(k) retirement plan. Addison uses her automobile 70% for business and 30% for personal. The automobile, a Toyota Avalon, was purchased new on June 30, 2017, for 37,000 (no trade-in was involved). Depreciation has been claimed using the MACRS 200% declining-balance method, and no 179 election was made in the year of purchase. (For depreciation information, see the IRS Instructions for Form 4562, Part V.) During 2019, Addison drove 15,000 miles and incurred and paid the following expenses relating to the automobile: Because VITA does not have an office in Spokane, the company expects Addison to maintain one in her home. Out of 1.500 square feet of living space in her apartment, Addison has set aside 300 square feet as an office. Expenses for 2019 relating to the office are listed below. Addisons employment-related expenses (except for the trip to Korea) for 2019 are summarized below. Most of Addisons business trips involve visits to retail outlets in her region. Store managers and their key employees, as well as some suppliers, were the parties entertained. The business gifts were boxes of candy costing 30 (25 each plus 5 for wrapping and shipping) sent to 18 store managers at Christmas. The continuing education was a noncredit course dealing with improving management skills that Addison took online. In July 2019, Addison traveled to Korea to investigate a new process that is being developed to convert fish parts to a solid consumable tablet form. She spent one week checking out the process and then took a one-week vacation tour of the country. The round-trip airfare was 3,600, and her expenses relating to business were 2,100 for lodging (300 each night), 1,470 for meals, and 350 for transportation. Upon returning to the United States, Addison sent her findings about the process to her employer. VITA was so pleased with her report that it gave her an employee achievement award of 10,000. The award was sent to Addison in January 2020. Besides the items already mentioned, Addison had the following receipts in 2019: Regarding the city lot (located in Vancouver), Addison purchased the property in 2004 for 16,000 and held it as an investment. Unfortunately, the neighborhood where the lot was located deteriorated, and property values declined. In 2019, Addison decided to cut her losses and sold the property for 13,000. The sailboat was used for pleasure and was purchased in 2015 for 16,500. Addison sold the boat because she purchased a new and larger model (see below). While at the Spokane airport, Addison found an unmarked envelope containing 55,000 in 50 bills. Because no mention of any lost funds was noted in the media, Addison kept the money. Addisons expenditures for 2019 (not previously noted) are summarized below. Addison keeps careful records regarding sales taxes. In 2019, the sales tax total was unusually high due to the purchase of a new sailboat. In 2019, Addison decided to pay her church pledge for both 2019 and 2020. The insurance premium was on a policy covering her fathers life. (Addison is the designated beneficiary under the policy.) Addisons employer withheld 8,600 for Federal income tax purposes, and she applied her 800 overpayment for 2018 toward the 2019 tax liability. Compute Addisons Federal income tax payable (or refund) for 2019. In making the calculation, use the Fax Rate Schedule and disregard the application of the alternative minimum tax (AMI), which is not discussed until Chapter 12.
Tia is married and is employed by Carrera Auto Parts. In 2019, Carrera established high-deductible health insurance for all its employees. The plan has a 2,700 deductible for married taxpayers. Carrera also contributes 5 percent of each employees salary to a Health Savings Account. Tias salary is 30,000 in 2019 and 32,000 in 2020. Tia makes the maximum allowable contribution to her HSA in 2019 and 2020. She received 600 from the HSA for her 2019 medical expenses. In 2020, she spends 1,400 on medical expenses from her HSA. The MSA earns 28 in 2019 and 46 in 2020. a. What is the effect of the HSA transactions on Tias adjusted gross income? b. How much does Tia have in her HSA account at the end of 2020?
Grace's employer is now offering group-term life insurance. The company will provide each employee with $185,000 of group-term life insurance. It costs Grace's employer $875 to provide this amount of insurance to Grace each year. Assuming that Grace is 31 years old, use the tale to determine the monthly premium that Grace must inckude in income as a result of receiving the group-term life benefit. EXHIBIT 12-08 Uniform Premiums for $1,000 of Group-Term Life Insurance Protection 5-Year Age Bracket. Cost Per $1,000 of Protection for One Month Under 25 $0.05 25 to 29 0.06 30 to 34 0.08 35 to 39 0.09 40 to 44 0.10 45 to 49 0.15 50 to 54 0.23
! Required information [The following information applies to the questions displayed below.] Smithers is a self-employed individual who earns $37,000 per year in self-employment income. Smithers pays $2,350 in annual health insurance premiums (not through an exchange) for his own medical care. In each of the following situations, determine the amount of the deductible health insurance premium for Smithers before any AGI deduction and where the premiums are deductible. a. Smithers is single and the self-employment income is his only source of income.
1. Payments made by an employer for health insurance on behalf of an employee are considered income to the employee at the time the payments are made. a. True b. False 2. Joey is a single taxpayer. Joey's employer pays $1,800 per year for his health insurance. During the year, Joey had medical expenses of $2,500 and the insurance company reimbursed him for the full $2,500. How much of the above amounts, if any, must be included in Joey's gross income? Why?
For purposes of the Child and Dependent Care Credit, all the following are qualified expenses except for which one? a. نن فم b. d. A $700 adult day care expense for a disabled spouse while the taxpayer workers. A $450 childcare expense while the taxpayer obtains emergency medical care. A $500 payment to a grandparent for childcare while the taxpayer is employed. A $350 payment to a day care center while the taxpayer is looking for employment.
M104.
Which of the following taxpayers are liable to pay the Medicare levy surcharge? Select one: A. Ian has a taxable income of $20,000, is single without dependants and doesn't have private health insurance B. Susan and Murray have a combined taxable income of $95,000, four children aged two to 10, and hold private health insurance (hospital cover) C. Vlad and Wilma have a combined taxable income of $310,000, two children under 18 and do not hold private health insurance D. Amelia has a taxable income of $65,000, is a sole parent to Charlie (5) and holds private health insurance (hospital cover)

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