Ken Tully and Tanner Bailey began a new consulting business on January 1, 2019. They organized the business as a C corporation, KT, Inc. During 2019, the corporation was successful and generated revenues of $1,800,000. KT had operating expenses of $715,000 before any payments to Ken or Tanner. During 2019, KT paid dividends to Ken and Tanner in the amount of $150,000 each. Assume that Ken's wife earned $170,000 from her job, they file a joint return, have itemized deductions of $35,000, and have no children. (Assume the qualified dividends tax rate is 15%.) Read the requirements (Click the icon to view the 2019 tax rate schedule for the Married filing jointly filing status.) (Click the icon to view the corporation tax rate information.) (Click the icon to view the standard deduction amounts.) Requirement a. Compute the total tax liability of KT and Ken and his wife for 2019. (If an input field is not used in the table, leave the input field empty; do not select a label or enter a zero. Do not round intermediary calculations. Only round the amounts you enter in the input fields to the nearest cent. Use the tax rate schedule for necessary tax calculations.) Begin by calculating the tax liability for KT. Reference - X Minus: Taxable income Corporate tax Compute the tax liability of Ken and his wife. Married, Filing Joint and Surviving Spouse If taxable income is: The tax is: Not over $19,400 10% of taxable income. Over $19,400 but not over $78,950 $1,940.00 + 12% of the excess over $19,400. Over $78,950 but not over $168,400 $9,086.00 + 22% of the excess over $78,950. Over $168,400 but not over $321,450 $28,765.00 +24% of the excess over $168,400 Over $321,450 but not over $408,200 .... $65,497.00 + 32% of the excess over $321,450. Over $408,200 but not over $612,350 .... $93,257,00 + 35% of the excess over $408,200. Over $612,350 $164,709.50 + 37% of the excess over $612,350 Personal and Dependency Exemptions Suspended: In conjunction with the increased standard deduction amount, the Tax Cuts and Jobs Act reduces the personal exemption amount to 50 for tax years from 2018 through 2025, effectively suspending the exemptions for these years. Adjusted gross income (AGI) Minus: Deductions from AGI: Taxable income Print Done Tax on taxable income without dividends (tax rate schedule) Tax on dividends Ken Tully and Tanner Bailey began a new consulting business on January 1, 2019. They organized the business as a C corporation, KT, Inc. During 2019, the (Click the icon to view the 2019 tax rate schedule for the Married filing jointly filing sta corporation was successful and generated revenues of $1,800,000. KT had operating expenses of $715,000 before any payments to Ken or Tanner. During 2019, KT paid dividends to Ken and Tanner in the amount of $150,000 each. Assume that Ken's wife earned $170,000 from her job, they file a joint return, have itemized (Click the icon to view the corporation tax rate information.) deductions of $35,000, and have no children. (Assume the qualified dividends tax rate is 15%.) (Click the icon to view the standard deduction amounts.) Read the requirements Total lax ( mividual) Requirement b. Instead of organizing the consulting business as a C corporation, assume Ken and Tanner organized the business as a limited liability company, KT, LLC. KT made a distribution of $150,000 each to Ken and Tanner during 2019. Compute tax on net investment income. (If an input field is not used in the table, leave the input field empty; do not select a label or enter a zero. Do not round intermediary calculations. Only round the amounts you enter in the input fields to the nearest cent. Use the with a zero balance.) Begin by calculating the tax liability for KT, LLC. Reference Minus: A corporation's taxable income is subject to a flat tax rate of 21%. Taxable income Reference Corporate tax Compute the tax liability of Ken for 2019. STANDARD DEDUCTION Filing Status $ 24,400 $ 18,350 Adjusted gross income (AGI) Minus: Deductions from AGI: $ 12.200 $ 12,200 Married individuals filing joint returns and surviving spouses Heads of households Unmarried individuals (other than surviving spouses and heads of households) Married individuals filing separate returns Additional standard deduction for the aged and the blind; Individual who is married and surviving spouses Additional standard deduction for the aged and the blind; Individual who is unmarried and not a surviving spouse Taxpayer claimed as dependent on another taxpayer's return: Greater of (1) earned income plus $350 or (2) $1,100. These amounts are $2,600 and $3,300, respectively, for a taxpayer who is both aged and blind. $1,300* $1,650* Taxable income Tax on taxable income without dividends (tax rate schedule) Tax on dividends Total tax (Individual) Print Done Choose from any list or enter any number in the input fields and then continue to the next question. Ken Tully and Tanner Bailey began a new consulting business on January 1, 2019. They organized the business as a C corporation, KT, Inc. During 2019, the corporation was successful and generated revenues of $1,800,000. KT had operating expenses of $715,000 before any payments to Ken or Tanner. During 2019, KT paid dividends to Ken and Tanner in the amount of $150,000 each. Assume that Ken's wife earned $170,000 from her job, they file a joint return, have itemized deductions of $35,000, and have no children. (Assume the qualified dividends tax rate is 15%.) Read the requirements (Click the icon to view the 2019 tax rate schedule for the Married filing jointly filing status.) (Click the icon to view the corporation tax rate information.) (Click the icon to view the standard deduction amounts.) Requirement a. Compute the total tax liability of KT and Ken and his wife for 2019. (If an input field is not used in the table, leave the input field empty; do not select a label or enter a zero. Do not round intermediary calculations. Only round the amounts you enter in the input fields to the nearest cent. Use the tax rate schedule for necessary tax calculations.) Begin by calculating the tax liability for KT. Reference - X Minus: Taxable income Corporate tax Compute the tax liability of Ken and his wife. Married, Filing Joint and Surviving Spouse If taxable income is: The tax is: Not over $19,400 10% of taxable income. Over $19,400 but not over $78,950 $1,940.00 + 12% of the excess over $19,400. Over $78,950 but not over $168,400 $9,086.00 + 22% of the excess over $78,950. Over $168,400 but not over $321,450 $28,765.00 +24% of the excess over $168,400 Over $321,450 but not over $408,200 .... $65,497.00 + 32% of the excess over $321,450. Over $408,200 but not over $612,350 .... $93,257,00 + 35% of the excess over $408,200. Over $612,350 $164,709.50 + 37% of the excess over $612,350 Personal and Dependency Exemptions Suspended: In conjunction with the increased standard deduction amount, the Tax Cuts and Jobs Act reduces the personal exemption amount to 50 for tax years from 2018 through 2025, effectively suspending the exemptions for these years. Adjusted gross income (AGI) Minus: Deductions from AGI: Taxable income Print Done Tax on taxable income without dividends (tax rate schedule) Tax on dividends Ken Tully and Tanner Bailey began a new consulting business on January 1, 2019. They organized the business as a C corporation, KT, Inc. During 2019, the (Click the icon to view the 2019 tax rate schedule for the Married filing jointly filing sta corporation was successful and generated revenues of $1,800,000. KT had operating expenses of $715,000 before any payments to Ken or Tanner. During 2019, KT paid dividends to Ken and Tanner in the amount of $150,000 each. Assume that Ken's wife earned $170,000 from her job, they file a joint return, have itemized (Click the icon to view the corporation tax rate information.) deductions of $35,000, and have no children. (Assume the qualified dividends tax rate is 15%.) (Click the icon to view the standard deduction amounts.) Read the requirements Total lax ( mividual) Requirement b. Instead of organizing the consulting business as a C corporation, assume Ken and Tanner organized the business as a limited liability company, KT, LLC. KT made a distribution of $150,000 each to Ken and Tanner during 2019. Compute tax on net investment income. (If an input field is not used in the table, leave the input field empty; do not select a label or enter a zero. Do not round intermediary calculations. Only round the amounts you enter in the input fields to the nearest cent. Use the with a zero balance.) Begin by calculating the tax liability for KT, LLC. Reference Minus: A corporation's taxable income is subject to a flat tax rate of 21%. Taxable income Reference Corporate tax Compute the tax liability of Ken for 2019. STANDARD DEDUCTION Filing Status $ 24,400 $ 18,350 Adjusted gross income (AGI) Minus: Deductions from AGI: $ 12.200 $ 12,200 Married individuals filing joint returns and surviving spouses Heads of households Unmarried individuals (other than surviving spouses and heads of households) Married individuals filing separate returns Additional standard deduction for the aged and the blind; Individual who is married and surviving spouses Additional standard deduction for the aged and the blind; Individual who is unmarried and not a surviving spouse Taxpayer claimed as dependent on another taxpayer's return: Greater of (1) earned income plus $350 or (2) $1,100. These amounts are $2,600 and $3,300, respectively, for a taxpayer who is both aged and blind. $1,300* $1,650* Taxable income Tax on taxable income without dividends (tax rate schedule) Tax on dividends Total tax (Individual) Print Done Choose from any list or enter any number in the input fields and then continue to the next