Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Part III A farm family filed their income tax return with the following totals. (7 pts) Net farm profit (Schedule F) $82,000 Capital gains (Schedule

image text in transcribed
Part III A farm family filed their income tax return with the following totals. (7 pts) Net farm profit (Schedule F) $82,000 Capital gains (Schedule D) $10,000 Other taxable income (off-farm rent) $8.000 $100,000 Personal deduction $20,000 Assume the tax rates this year are as follows: Rate Bracket Self-employment tax 15.3% up to $120,000 Capital gains tax 15% no limit Ordinary income tax (federal) 10% SO to $15,000 15% $15,000 to $50,000 25% over $50,000 How much did they owe for each of the following types of taxes? a. self-employment tax to pay (on net farm profit) b. capital gains tax to pay (on capital gains) c. amount of income subject to ordinary income tax (net farm profit + other taxable income - personal deductions and exemptions) d. ordinary income tax to pay e. tax credits for 3 persons ($1,000 each) f. total tax bill (a + b - due) g. marginal tax rate on another $ of ordinary farm income

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

Human Resources In The Urban Economy

Authors: Mark Perlman

1st Edition

1317332474, 9781317332473

More Books

Students also viewed these Economics questions

Question

What background experience do you have?

Answered: 1 week ago

Question

2. Value-oriented information and

Answered: 1 week ago

Question

1. Empirical or factual information,

Answered: 1 week ago

Question

1. To take in the necessary information,

Answered: 1 week ago