Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Lily Tucker (single) owns and operates a bike shop as a sole proprietorship. This year, she sells the following long-term assets used in her business:

Lily Tucker (single) owns and operates a bike shop as a sole proprietorship. This year, she sells the following long-term assets used in her business:

Asset Sales Price Cost Accumulated Depreciation
Building $338,400 $296,000 $69,000
Equipment $118,500 $211,700 $30,200

Lily's taxable income before these transactions is $241,000.

What are Lily's taxable income and tax liability for the year? Use Tax Rate Schedule for reference. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.

taxable income

tax liability

image text in transcribed

2016 Federal Tax Rate Schedule Schedule X-Single Schedule Z-Head of Household If taxable If taxable income is But not income is But not The tax is The tax is: over: Over Over Over 0 9,275 10% of taxable income 0 13,250 10% of taxable income 9,275 37650 $92750 plus 15% of the excess 13,250 50,400 $1,325.00 plus 15% of the excess over $9,275 over $13,250 37650 91,150 $5,183.75 plus 25% of the excess 50,400 $130,150 $6.89750 plus 25% of the excess over $37650 over $50,400 $130,150 $210,800 $26,835.00 plus 28% of the excess 91,150 $190,150 $18,558.75 plus 28% of the excess over $130,150 over $91,150 $190,150 $413,350 $46,278.75 plus 33% of the excess $210,800 $413,350 $49,41700 plus 33% of the excess over $210,800 over $190,150 $413,350 $415,050 $119,934.75 plus 35% of the excess $413,350 $441,000 $116,258.50 plus 35% of the excess over $413,350 over $413,350 $415,050 $120,529.75 plus 39.6% of the excess $441,000 $125,936.00 plus 39.6% of the excess over $415,050 over $441,000 Schedule Y 1- Married Filing Jointly Schedule Y 2- Married Filing Separately of Qualifying Widow(er) If taxable income is But not If taxable income is But not The tax is: Over Over The tax is: Over Over 0 9,275 10% of taxable income 9,275 37650 $92750 plus 15% of the excess 0 18,550 10% of taxable income Over $9,275 18,550 75,300 $1,855.00 plus 15% of the excess 37650 75,950 $5,183.75 plus 25% of the excess over $18,550 75,300 $151,900 $10,36750 plus 25% of the excess over $37650 over $75,300 75,950 $115,725 $14,758.75 plus 28% of the excess $151,900 $231,450 $29,51750 plus 28% of the excess over $75,950 over $151,900 $115,725 $206,675 $25,895.75 plus 33% of the excess over $115,725 $231,450 $413,350 $51,791.50 plus 33% of the excess over $231,450 $206,675 $233,475 $55,909.25 plus 35% of the excess over $206,675 $413,350 $466,950 $111,818.50 plus 35% of the excess over $413,350 $233,475 $65,289.25 plus 39.6% of the excess over $233,475 $466,950 $130,578.50 plus 39.6% of the excess over $466,950

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

A Concise Course On Auditing An Authoritative Text For Stakeholders

Authors: Onyuka Felix McDubus

1st Edition

3844395415, 978-3844395419

More Books

Students also viewed these Accounting questions

Question

4. Give partial credit for partially correct answers.

Answered: 1 week ago