Federal income tax chapter 6

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Problem 6-2 Accounting Methods (L0 6.2) Yolanda is a cash basis taxpayer with the following transactions during the year: Cash received from sale of products $70,000 Cash paid for expenses (except rent and interest) 40,000 Rent prepaid on a leased building for 18 months beginning December 1 48,600 Prepaid interest on a bank loan, paid on December 31 for the next 3 months 5,000 Calculate Yolanda's income from her business for this calendar year. If an amount is zero, enter "0". If required, in your computations round any division to five decimal places and round final answers to the nearest dollar. Expenses: Other than rent and interest :] Net income Q Problem 6-17 The Nanny Tax (L0 6.7) Sally hires a maid to work in her home for $280 per month. The maid is 25 years old and not related to Sally. During 2019, the maid worked 9 months for Sally. Do not round immediate computations and round your final answers to two decimal places. a. What is the amount of Social Security tax Sally must pay as the maid's employer? $[:J b. What is the amount of Medicare tax Sally must pay as the maid's employer? Sally's employer's Medicare tax: $:] c. What is the amount of Social Security and Medicare tax which must be withheld from the maid's wages? Sally should withhold for Social Security and Medicare tax of: E Problem 6-19 (Algorithmic) Special Rules for High-Income Taxpayers (L0 6.8) Rachel is single and has wages of $161,150 and dividend income of $96,690. She has no investment expenses. Calculate the amount of the 3.8 percent net investment income tax she must pay. Round your answer to the nearest whole dollar. Q Problem 6-20 (Algorithmic) Computing the 0.9 Percent Medicare Tax for High-Income Taxpayers (LO 6.8) Married taxpayers Otto and Ruth are both self-employed and file a joint return. Otto earns $414,400 of self-employment income and Ruth has a self-employment loss of $38,300. How much 0.9 percent Medicare tax for high income taxpayers will Otto and Ruth have to pay with their 2019 income tax return? If required, round your final answer to nearest dollar