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Richard Norton is required to pay self-employment tax based on the net profits of his farm business. For purposes of this task (Self-Employment Tax), assume
Richard Norton is required to pay self-employment tax based on the net profits of his farm business. For purposes of this task (Self-Employment Tax), assume that Richard had a net profit of $105,000 from the farm business for Year 3 and $10,000 of Section 1231 gain. Also assume that the maximum net earnings from self-employment for the Social Security tax are $160,200 for Year 3. Assume the following rates: 12.4 percent for Social Security and 2.9 percent for Medicare. Complete the following items in the table below. Enter amounts as positive whole numbers. If the value is zero, enter a zero (0)
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