ployment tax? B. Compute Wilma’s 2021 self-employment tax, assuming Wilma has no other earned income. C. Compute Wilma's allowable QBI deduction, assuming $55,000 of W-2 wages and $110,000 unadjusted basis of tangible depreciable property. Further assume the ove
In 2021, Wilma Way’s sole proprietorship, WW Bookstore, generated $135,000 net profit. In addition, Wilma recognized a $6,500 Section 1231 gain on the sale of business furniture. The business checking account earned $450 interest income.
Required:
A. Which of these income items are subject to self-employment tax?
B. Compute Wilma’s 2021 self-employment tax, assuming Wilma has no other earned income.
C. Compute Wilma's allowable QBI deduction, assuming $55,000 of W-2 wages and $110,000 unadjusted basis of tangible
D. Compute the overall impact of the bookstore activity on Wilma’s 2021 taxable income.
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
