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JDD Corporation provides the following benefits to its employee, Ahmed (age 50): Salary $ 339,000 Health insurance 14,700 Dental insurance 2,100 Life insurance 3,900 Dependent
JDD Corporation provides the following benefits to its employee, Ahmed (age 50):
Salary | $ | 339,000 | |
Health insurance | 14,700 | ||
Dental insurance | 2,100 | ||
Life insurance | 3,900 | ||
Dependent care | 4,200 | ||
Professional dues | 1,310 | ||
Personal use of company jet | 259,000 | ||
|
Assume the life insurance is a group-term life insurance policy that provides $294,000 of coverage for Ahmed. (Use EXHIBIT 12-8.) Assuming Ahmed is subject to a marginal tax rate of 32 percent, what is his after-tax benefit of receiving each of these benefits (ignoring FICA taxes)? (Enter all amounts as positive values. Round your intermediate computations and final answers to the nearest whole dollar.)
Description Amount Taxable benefits $ 339,000 Salary Life insurance (taxable portion) Personal use of company jet 14,700 259,000 Taxable total $ 612,700 Marginal tax rate % Income tax on benefits After-tax benefit of taxable items Nontaxable benefits Dental insurance Dependent care Health insurance Life insurance (nontaxable portion) Professional dues Nontaxable total $ 0 After-tax benefit of salary and benefits $ 0Step by Step Solution
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