In the 2020 tax year, Karl had the following tax information: He earned net business income of $80,000. As a self-employed individual, Karl paid the
In the 2020 tax year, Karl had the following tax information:
He earned net business income of $80,000. As a self-employed individual, Karl paid the required max amounts of CPP and EI. Karl received non-eligible dividends in the amount of $2,000 during 2020. During the year, Karl sold a rare watch. He had purchased the watch from eBay a few years ago for $500. He was able to sell it for $1,200 in 2020. Karl is a single father to healthy 4 year old twins. He incurred $10,000 in eligible child care expenses during 2020. Karl has a rental property which, due to months without a tenant, incurred a net rental loss of $12,500 in 2020. Karl has an unused $9,000 non-capital loss carryover from 2018. He started his business that year and incurred a loss which resulted in the carryover. He hasn't been able to carry it over to any other taxation year so far. Required:
Calculate Karl's Net Income For Tax Purposes and Taxable Income for the current year by completing the table below. In each row (other than the NITP and TI rows), provide an explanation and/or calculation in the first box and then the total in the second box.
This question requires you to fill in the 12 boxes below. Be sure to enter any negative numbers with a negative sign - .
3(a) 3(b) 3(c) 3(d) Net Income for Tax Purposes Division C Deductions Taxable Income
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