Question
This year Lloyd, a single taxpayer, estimates that his tax liability will be $13,150. Last year, his total tax liability was $17,100. He estimates that
This year Lloyd, a single taxpayer, estimates that his tax liability will be $13,150. Last year, his total tax liability was $17,100. |
He estimates that his tax withholding from his employer will be $9,795.
a.How much does Lloyd need to increase his withholding by (for the year), in order to avoid the underpayment penalt
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b. Assuming Lloyd does not make any additional payments, what is the amount of his underpayment penalty? Assume the federal short-term rate is 5 percent. (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)
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