Tom sold mutual fund shares he had owned 3 years so that he could use the proceeds to return to college. Tom is
Tom sold mutual fund shares he had owned 3 years so that he could use the proceeds to return to college. Tom is
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Tom sold mutual fund shares he had owned 3 years so that he could use the proceeds to return to college. Tom is in the 15% marginal tax bracket and his capital gains from this sale were $11,000. How much tax would Tom owe on those gains?
Group of answer choices
$11,000
$ 3,080
$ 1,650
$ 1,100
$ 0
Expert Solution
Step 1
In USA as per IRS rules for tax years 2021 & 2022 the capital gain tax is 0% , 15% & 20% on sale of assets hold for a period more than a year. With this basic understanding we will solve the above MCQ as under ---
Please refer step 2
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