Problem 8-78 (LO 8-5) (Algo) This year, Paula and Simon (married filing jointly) estimate that their tax liability will be $216,500. Last year, their total tax liability was $181,000. They estimate that their tax withholding from their employers will be $187,650. a. Are Paula and Simon required to increase their withholdings or make estimated tax payments this year to avoid the underpayment penalty? Yes O No b. By how much, if any, must Paula and Simon increase their withholding and/or estimated tax payments for the year to avoid underpayment penalties? Increase in withholding $ 11,565
Problem 8-78 (LO 8-5) (Algo) This year, Paula and Simon (married filing jointly) estimate that their tax liability will be $216,500. Last year, their total tax liability was $181,000. They estimate that their tax withholding from their employers will be $187,650. a. Are Paula and Simon required to increase their withholdings or make estimated tax payments this year to avoid the underpayment penalty? Yes O No b. By how much, if any, must Paula and Simon increase their withholding and/or estimated tax payments for the year to avoid underpayment penalties? Increase in withholding $ 11,565
Chapter13: Tax Credits And Payment Procedures
Section: Chapter Questions
Problem 4CPA
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![Problem 8-78 (LO 8-5) (Algo)
This year, Paula and Simon (married filing jointly) estimate that their tax liability will be $216,500. Last year, their total tax liability was
$181,000. They estimate that their tax withholding from their employers will be $187,650.
a. Are Paula and Simon required to increase their withholdings or make estimated tax payments this year to avoid the underpayment
penalty?
Yes
O No
b. By how much, if any, must Paula and Simon increase their withholding and/or estimated tax payments for the year to avoid
underpayment penalties?
Increase in withholding
$ 11,565](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd7b6ce77-7d1f-42c7-90fc-6e082dc1db1b%2F2a40349e-4c45-4558-a349-db1ab3ca983a%2Fg12ocr_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Problem 8-78 (LO 8-5) (Algo)
This year, Paula and Simon (married filing jointly) estimate that their tax liability will be $216,500. Last year, their total tax liability was
$181,000. They estimate that their tax withholding from their employers will be $187,650.
a. Are Paula and Simon required to increase their withholdings or make estimated tax payments this year to avoid the underpayment
penalty?
Yes
O No
b. By how much, if any, must Paula and Simon increase their withholding and/or estimated tax payments for the year to avoid
underpayment penalties?
Increase in withholding
$ 11,565
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