An investor in a 28% tax bracket owns land that is a capital asset with a $54,000 basis and a holding period of three years. The investor wishes to sell the asset at a price high enough so that he will have $122,000 in cash after paying the income taxes. a. What is the minimum price the investor could accept? b. What is the minimum price the investor could accept if all the gain is subject to the Medicare tax on net investment income?

* Capital Gains and Dividends Capital gains and losses are assigned to baskets. Five possible tax rates will apply to most capital gains and losses: times Ordinary income tax rates (up to 39.6 39.6% in 2015 2015) for gains on assets held one year or less. times 28 28% rate on collectibles gains and includible Sec. 1202 gains times 20 20% rate on gains on assets held for more than one year and qualified dividends (for taxpayers whose regular tax bracket is 39.6 39.6%) times 15 15% rate on gains on assets held for more than one year and qualified dividends (for taxpayers whose regular tax bracket is higher than 15 15% and less than 39.6 39.6%) times 0 0% rate on gains on assets held for more than one year and qualified dividends (for taxpayers whose regular tax bracket is not higher than 15 15%) Note: The net investment income of higher income taxpayers (modified AGI greater than $ 200 comma 000 $200,000 for single and $ 250 comma 000 $250,000 for married filing jointly) also may be subject to an additional tax of 3.8 3.8%. Net investment income includes dividends and capital gains, along with other types of investment income.*