1.Thad, a single taxpayer, has taxable income before the QBI deduction of $177,500. Thad, a CPA, operates an accounting practice as a single member LLC (which he reports as a sole proprietorship). During 2022, his proprietorship generates qualified business income of $142,000, W2 wages of $106,500, and $11,200 of qualified property.

Assume the QBI amount is net of the self-employment tax deduction. If required, round any division to two decimal places and use that rounded amount in any future computations. Round your final answer to the nearest dollar.

What is Thad's qualified business income deduction?

2.

Purple Company has $200,000 in net income for 2022 before deducting any compensation or other payment to its sole owner, Kirsten. Kirsten is single and she claims the $12,950 standard deduction for 2022 (she has no other deductions). Purple Company is Kirsten's only source of income.

Ignoring any employment tax considerations, compute Kirsten's after-tax income for each of the following situations.

Click here to access the 2022 individual tax rate schedule to use for this problem. Assume the corporate tax rate is 21%.

When required, carryout intermediate tax computations to the nearest cent and then round your final tax liability to the nearest dollar.

- Purple Company is a C corporation and the corporation pays out all of its after-tax income as a dividend to Kirsten.

Note: Individual taxpayers received preferential treatment regarding the taxation of qualified dividends (0%,15%,20%). For single taxpayers, the 0 percent rate applies to the first $41,675 of taxable income.

Purple Corporation's after-tax income--------------- and Kirsten's after tax income is ----------- what?(fill in the blank)