Tax Rate according to US- See chart
Jenn is 25 and works as a tax manager in Deloitte's Philadelphia office. She is married to Pat, who is a software engineer at Comcast. Jenn and Pat live in Center City with Jenn's aging father, for whom they provide full support. The following transactions occurred over 2019. 1) Jenn received $112,000 in salary from Deloitte; and had $19,000 of federal income tax withholding. 2) Pat received $97,000 in salary from Comcast; and had $16,100 of federal income tax withholding. 3) In June Jenn received a $3,000 award from her partner for outstanding client service. 4) Jenn really loves shopping at Target. Last year with her signing bonus she purchased some Target shares. During 2019 she received four dividend payments related to her Target investment. Assume they are qualified dividends. a) March 15, 2019 - 5800 b) June 15, 2019 - $700 c) September 15, 2019 - $750 d) December 15, 2019 - $600 5) Jenn and Pat generated S980 interest income for the year from their savings account. 6) Jenn loves to cook with her father, it's her favorite way to unwind at the end of a long day of tax research and compliance. This past year she decided to turn her hobby into a business! She takes local produce and makes big batches of soups and sauces, which she then packages and sells at the farmer's market in Rittenhouse Square every Saturday morning. Jenn had the following transactions in 2019 related to her soup business. a) She received $3,400 in soup sales. b) In February she spent $220 on plastic soup containers at the restaurant depot. In August she went back and spent another $150. c) She totaled all her produce receipts for the year, and she had spent $1,140 on vegetables to make her soups and sauces. d) Her booth at the market costs her $700 per year. e) The annual fee for her permit (allowing her to sell food) cost her $200. f) In June she received a $100 fine from the health department because the temperature of the cooler, holding her product, was not up to code. 7) Jenn's parents put an investment property in her name when she was much younger. This year she sold the property for $201,000. The tax basis of the property was $152,000. Jenn plans to use the proceeds of the sale towards a downpayment on their first home, but for now she has just put it into their savings account. 8) In October of 2019 Pat sold 10 shares of Tripadvisor stock for $45 per share. He bought them in October of 2016 for $62 per share. 9) Over the year Jenn received $900 in interest income from her bond investment in GameStop Corp. She also received $1,200 in interest income from her investment in PA municipal bonds. 10) In December Pat's grandfather passed away and left him $3,000 in his will. Calculate Jenn and Parts 2019 taxable income, and their tax liability for the year. Ignore any employment or self-employment taxes. Schedule Y-1-Married Filing Jointly or Qualifying Widow(er) If taxable income is But not over: over: The tax is: $ 0 $ 19,400 10% of taxable income $ 19,400 $ 78,950 $1,940 plus 12% of the excess over $ 19,400 $ 78,950 $ 168,400 $9,086 plus 22% of the excess over $78,950 $168,400 $321,450 $28,765 plus 24% of the excess over $168,400 $321,450 $408,200 $65,497 plus 32% of the excess over $321,450 $408,200 $612,350 $93,257 plus 35% of the excess over $408,200 $612,350 $164,709.50 plus 37% of the excess over $612,350
