Kat has a full-time job, but also runs a part-time business on the side. Kat’s social security wages during 2014 are $88,100, and she reports $40,000 of net profit on Schedule C. How much of Kat’s Schedule C net profit is subject to the OASDI and Medicare parts of the selfemployment tax?

a. $28,900 is subject to the 12.4% OASDI tax; $40,000 is subject to the 2.9% Medicare tax

b. $40,000 is subject to the 12.4% OASDI tax; $40,000 is subject to the 2.9% Medicare tax

c. $36,940 is subject to the 12.4% OASDI tax; $36,940 is subject to the 2.9% Medicare tax

d. $28,900 is subject to the 12.4% OASDI tax; $36,940 is subject to the 2.9% Medicare tax