Question
hi what are the steps for a and b? a.. Jane Smith currently holds tax-exempt bonds of Good Samaritan Healthcare that pays 9 percent interest.
hi what are the steps for a and b?
a.. Jane Smith currently holds tax-exempt bonds of Good Samaritan Healthcare that pays 9 percent interest. She is in the 30 percent tax bracket. Her broker wants her to buy some Beverly Enterprises taxable bonds that will be issued next week. With all else the same, what rate must be set on the Beverly bonds to make Jane interested in making a switch?
b. George and Margaret Wealthy are in the 42 percent tax bracket, considering both federal and state personal taxes. Norman Briggs, then CEO of Community General Hospital, has been aggressively pursuing the couple to contribute $400 thousand to the hospitals soon-to-be-built Cancer Care Center. Without the contribution, the Wealthys taxable income for 2014 would be $3 million. What impact would the contribution have on the Wealthys 2014 tax bill?
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