JT (single taxpayer) is a software engineer who earns both salary income as an employee, and business income as the sole proprietorof a business that provides custom software development. In 2023, they earned $350,000 of salary income. Consider the followingtwo possible scenarios for 2023Scenario A$350,000$50,000Scenario B$350,000Salary incomeBusiness income (loss)$300,000)Part A. What are JT's net earnings for tax purposes in Scenario A?400000Part B. What are JT's net earnings for tax purposes in Scenario B?650000 O

Gross income is the starting point from which the Internal Revenue Service (IRS) calculates an…

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JT (single taxpayer) is a software of a business that provides cust

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter12: Alternative Minimum Tax

Section: Chapter Questions

Problem 24CE

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Question

JT (single taxpayer) is a software engineer who earns both salary income as an employee, and business income as the sole proprietor
of a business that provides custom software development. In 2023, they earned $350,000 of salary income. Consider the following
two possible scenarios for 2023
Scenario A
$350,000
$50,000
Scenario B
$350,000
Salary income
Business income (loss)
$300,000)
Part A. What are JT's net earnings for tax purposes in Scenario A?
400000
Part B. What are JT's net earnings for tax purposes in Scenario B?
650000 O

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