Juan, who is single, is a self-employed carpenter as well as an e His self-employment net income is $28,350, and he received a $20,500. He is covered by his employer's pension plan, but his plan in which he could participate. Required: a. Up to how much of his self-employed health insurance premiu any? b. How much of Juan's self-employment taxes would be deductib

Juan, who is single, is a self-employed carpenter as well as an e His self-employment net income is $28,350, and he received a $20,500. He is covered by his employer's pension plan, but his plan in which he could participate. Required: a. Up to how much of his self-employed health insurance premiu any? b. How much of Juan's self-employment taxes would be deductib

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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Lars Osberg, a single taxpayer with a 35 percent marginal tax rate, desires health insurance. Volvo, his employer, has a 21 percent marginal tax rate. The health insurance will cost Lars $8,500 to purchase if he pays for it himself through the health exchange (Lars’s AGI is too high to receive any tax deduction for the insurance as a medical expense). Answer the following questions about this benefit. (Do not round intermediate computations. Round your final answer to the nearest whole dollar amount.) Assume that Volvo could purchase the insurance for $5,000. Lars is interested in getting health insurance, and he is willing to receive a lower salary in exchange for the health insurance. What is the least amount by which Volvo would be willing to reduce Lars’s salary while agreeing to pay his health insurance?
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Corina is self-employed. In 2020, her net profit from self-employment was $200,000, and she has no other income. What is Corina's SE tax liability? Round your answer to the nearest whole dollar.
Hardaway earned $118,000 of compensation this year. He also paid (or had paid for him) $3,100 of health insurance (not through an exchange). What is Hardaway's AGI in each of the following situations? (Ignore the effects of Social Security and self-employment taxes.) a. Hardaway is an employee, and his employer paid Hardaway's $3,100 of health insurance for him as a nontaxable fringe benefit. Consequently, Hardaway received $114,900 of taxable compensation and $3,100 of nontaxable compensation. b. Hardaway is a self-employed taxpayer, and he paid $3,100 of health insurance himself. He is not eligible to participate in an employer-sponsored plan
Kathleen contributes 3% of her $45,000 of annual earnings into an RRSP. As part of her total remuneration package, Kathleen's employer matches her RRSP contribution and applies it to her RRSP. What tax impact, if any, will the employer's contribution to Kathleen's RRSP have on her income? A) Kathleen will incur a taxable benefit of $1,350. B) No tax impact, as the benefit is considered non-taxable when paid by the employer. C) Kathleen will incur a taxable benefit of $2,700. D) There is not sufficient information to calculate the tax consequences.
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A taxpayer would be required to pay Social Security and Medicare taxes for a domestic employee in all but one of the following situations. In which situation would this not be required? a.A cook who is paid $35,000 a year b.A nanny who earns $22,000 a year c.A baby-sitter who earns $1,300 a year d.A cleaning lady who is paid $8,000 a year e.The taxpayer would not have to pay Social Security and Medicare taxes in any of the above situations.