Calculate tax liability, Taxation

Assignment Help:

Hello,

I am zainab ali, i want help in Tax assignment..

In 2012 Joe, age 15, earned $2900 from acting and had $12,200 of interest income and $14,000 of taxable qualified dividend income. Joe’s parents claim an exemption for him on their own return. His parents’ MTR is 25%. What is Joe’s tax liability?


Related Discussions:- Calculate tax liability

Explain the effects of taxation on the equilibrium of a firm, Q. Explain th...

Q. Explain the effects of taxation on the equilibrium of a firm? Suppose a tax is imposed on the producers of a commodity, the tax is on each unit for they produce. Naturally,

Assignment , I have the whole case and this is the question (Canadian Taxa...

I have the whole case and this is the question (Canadian Taxation) Compute Net Income, Taxable Income and Net Federal Tax Payable for 2012 for Sandra, Steven, Annabelle and Ronnie

Sales tax, Arnold and Beth file a joint return. Use the following data to c...

Arnold and Beth file a joint return. Use the following data to calculate their deduction for AGI. Mortgage interest on personal residence $ 4,000 Property taxes on personal resi

Determine the maximum cca , Lambda Ventures, an unincorporated business, ha...

Lambda Ventures, an unincorporated business, has a class 10 UCC balance on January 1, 2010 of $453,000.During 2010, it acquires additional Class 10 assets at a cost of $63,200.Also

Tax shields, T ax Shields A tax shield is defining any reductio...

T ax Shields A tax shield is defining any reduction in a corporation's tax bill which can be brought about by management. Depreciation, for example create a tax shield

Deductions, Roberta Santos, age 41, is single and lives at 120 Sanborne Ave...

Roberta Santos, age 41, is single and lives at 120 Sanborne Avenue, Springfield, IL 60781. Her Social Security number is 123-45-6789. Roberta has been divorced from her former husb

Work contract tax, how work contract tax is to be shown in the invoice?

how work contract tax is to be shown in the invoice?

Fringe benefits tax, Mr and Mrs Adams and Mr Adam's mother, Louise, bought ...

Mr and Mrs Adams and Mr Adam's mother, Louise, bought an investment property equally as joint owners in 1979 for $30000. Mr Adams died in 2005. Louise died in 2006. The property wa

How much taxable income, Stewie loaned a friend $12,500 to buy some stock 3...

Stewie loaned a friend $12,500 to buy some stock 3 years ago. In the current year the debt became worthless. a. How much is Stewie's deduction for the bad debt for this year? (Assu

Expertsmind

3/14/2013 12:57:56 AM

Adjusted Gross Income: 

Earned Income: 

            Income from Acting:                                                  $2900 

Unearned Income: 

            Interest Income:                                                          $12200

            Taxable Qualified Dividend Income:                         $14000 

                                                                                                $26200

 

Total Adjusted Gross Income                                                                      $29100 

Less:    The Larger of:

Standard Deduction                                 $950 

Or 

$300 plus earned income          

 

Earned income:     Income from acting    

                              ($300 + $2900)           $3200                          $3200

 

 

Total Taxable Income                                                                                                           $25900

Joe’s Tax Liability                                        

 

Joe’s Net Unearned Income

 

Interest Income                                               $12200

Taxable Qualified Dividend Income:             $14000

 

Net Unearned Income:                                   $26200

 

Unearned Income > $1900                             $24300

 

 

Out of $ 24300 unearned Income Taxable Qualified Income is taxable @15%

 

So, Tax on Taxable Qualified Dividend Income

 

$14000*15%                           =          $2100 

 

Tax on other Unearned Income taxable on parent’s taxed rates:

 

Parent’s tax rate is 25%

 

($10300*25%)                                    =          $2576

                                   

 

Tax on taxable Income minus Net Unearned Income

 

Tax at child rate @ 10%

 

($25900-$24300)*10%           =          $160

 

Total Tax Liability                =          $4836  

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd