50.1K

Verified Solution

Link Copied!

1. Capital Gains Tax. David is in the 35% tax bracket making $360,000 per year as an account executive. Recently, he sold stock that he had held longer than a year for a gain of $20,000. How much tax will David pay on this capital gain?
Work:
2. Deductions. Donna and Brian are married and file a joint return and together have an Adjusted Gross Income of $180,000. Married filing jointly standard deduction is $24,800 for 2020. They own their home. They have the following itemized deductions: Should Donna and Brian itemize their deductions or use the standard deduction?
Medical Bills and Health Insurance $26,000 Property tax $1,250 Mortgage Interest expense $5,500 State sales taxes $7,000 Miscellaneous deductions $3,600
Work:
3. Tax Brackets. Caleb calculated his Adjusted Gross Income as $86,000 from his job as a health care administrator. He has an opportunity to work on an additional project for a bonus before year end which would give him an additional $10,000 in income. How much federal income tax would Caleb owe in 2020 solely on this additional $10,000 in income?
Work:
4. Deduction. Sara's is considering making a $5,000 contribution to her companys retirement plan which is considered a tax deferred contribution. She currently makes $46,000 as dental hygienist. How much would she save in her federal income tax bill for 2020 by making this $5,000 contribution?
Work:
5.a. Impact on Taxes. Michael has a marginal tax rate of 15%. He suddenly realizes that he neglected to include a $2,800 tax deduction. How will this oversight affect his federal tax bill in 2020 (specify dollar amount in your answer)?
Work:
5.b. Impact on Taxes. If Michael had forgotten a $2,800 tax credit (instead of a $2,800 tax deduction), how would his taxes be affected (specify dollar amount in your answer)?
Work:

Answer & Explanation Solved by verified expert

See Answer