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Problem 4-31 (LO 4-1) (Algo)

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Emily, who is single, has been offered a position as a city landscape consultant. The position pays $147,800 in cash wages. Assume Emily has no dependents. Emily deducts the standard deduction instead of itemized deductions, and she is not eligible for the qualified business income deduction. (Use the tax rate schedules.) (Round your intermediate calculations and final answer to the nearest whole dollar amount.)

Problem 4-31 Part-a (Algo)

a. What is the amount of Emilys after-tax compensation (ignore payroll taxes)?

Problem 4-31 Parts b-1 to b-2 (Algo)

b-1. Suppose Emily receives a competing job offer of $139,000 in cash compensation and nontaxable (excluded) benefits worth $8,800. What is the amount of Emilys after-tax compensation for the competing offer?

b-2. Which job should she take if taxes are the only concern?

multiple choice

• Landscape consultant

• Competing job

2020 Tax Rate Schedules

Individuals

Schedule X-Single

If taxable income is over:	But not over:	The tax is:
$ 0	$ 9,875	10% of taxable income
$ 9,875	$ 40,125	$987.50 plus 12% of the excess over $9,875
$ 40,125	$ 85,525	$4,617.50 plus 22% of the excess over $40,125
$ 85,525	$163,300	$14,605.50 plus 24% of the excess over $85,525
$163,300	$207,350	$33,271.50 plus 32% of the excess over $163,300
$207,350	$518,400	$47,367.50 plus 35% of the excess over $207,350
$518,400		$156,235 plus 37% of the excess over $518,400

Schedule Y-1-Married Filing Jointly or Qualifying Widow(er)

If taxable income is over:	But not over:	The tax is:
$ 0	$ 19,750	10% of taxable income
$ 19,750	$ 80,250	$1,975 plus 12% of the excess over $19,750
$ 80,250	$171,050	$9,235 plus 22% of the excess over $80,250
$171,050	$326,600	$29,211 plus 24% of the excess over $171,050
$326,600	$414,700	$66,543 plus 32% of the excess over $326,600
$414,700	$622,050	$94,735 plus 35% of the excess over $414,700
$622,050		$167,307.50 plus 37% of the excess over $622,050

Schedule Z-Head of Household

If taxable income is over:	But not over:	The tax is:
$ 0	$ 14,100	10% of taxable income
$ 14,100	$ 53,700	$1,410 plus 12% of the excess over $14,100
$ 53,700	$ 85,500	$6,162 plus 22% of the excess over $53,700
$ 85,500	$163,300	$13,158 plus 24% of the excess over $85,500
$163,300	$207,350	$31,830 plus 32% of the excess over $163,300
$207,350	$518,400	$45,926 plus 35% of the excess over $207,350
$518,400		$154,793.50 plus 37% of the excess over $518,400

Schedule Y-2-Married Filing Separately

If taxable income is over:	But not over:	The tax is:
$ 0	$ 9,875	10% of taxable income
$ 9,875	$ 40,125	$987.50 plus 12% of the excess over $9,875
$ 40,125	$ 85,525	$4,617.50 plus 22% of the excess over $40,125
$ 85,525	$163,300	$14,605.50 plus 24% of the excess over $85,525
$163,300	$207,350	$33,271.50 plus 32% of the excess over $163,300
$207,350	$311,025	$47,367.50 plus 35% of the excess over $207,350
$311,025		$83,653.75 plus 37% of the excess over $311,025