1, Which of the following MOST likely suggests that a taxpayer is an employee rather than an independent contractor?

Group of answer choices

Works for many firms.

May recognize a business loss.

Sets own working hours.

Must work on the employer's premises.

2. During the current year, Sara (married to James and they maintain a home for their son) generated $250,000 of earnings from her sole proprietorship. If the couple has no other income, approximately how much self-employment tax will they owe on their current year tax return?

Group of answer choices

$22,491.

$24,923.

$26,161.

$35,324.

3. Mr. and Mrs. Smith, married filing jointly, reported $1,000,000 taxable income and $1,200,000 alternative minimum taxable income before any exemptions for the current year. Calculate the Smith's tentative minimum tax for the current year.

Group of answer choices

$298,810

$304,549

$307,224

$311,346

4. Grace, age 40 and married filing separately, has a $400,000 salary, $100,000 short-term capital gains, and $100,000 private activity municipal bond interest income from The City of Bloomington. Grace's itemize deductions are $10,000. Calculate Grace's tentative minimum tax for the current year.

Group of answer choices

$146,833.

$149,405.

$151,551.

$153,612.

5. Five years ago, ABC, Incorporated granted Ms. Smith, age 67 and married filing separately, an incentive stock option to purchase 10,000 shares of ABC stock at $60 per share. On date of grant, the market price was $50 per share. This year, Ms. Smith exercised the option when the market price was $80 per share. Ms. Smith's only other income for the year is her $400,000 salary and has $13,000 itemized deductions. Compute Ms. Smith's tentative minimum tax.

Group of answer choices

$130,810

$146,833

$150,955

$153,612