Question

The following information applies to the questions displayed below) Jacob is a member of WCC an LLC taxed as a partnership Jacob was alocated S0000 or bemess Income from WCC for the year Jacob's marginal income tax rates 37 percent. The business a location is subject to 29 percent of self employment tax and 9 percent additional Medicare tax. (Round your Intermediate calculations to the nearest whole dollar amount) b. What is the amount of tax Jacob will owe on the income allocation of the income quates for the full i deduction? qualified business income and Jacob

Answer 1

b

Particulars	Amount($)
1. Business income allocation	$60,000
2. QBI deductions	$12,000
3. Deduction for 50% of SE tax(150,000*0.9235*0.029*0.5)	$803
4. Net income taxable business income (1)-(2)-(3)	$47,197
5. Income tax paid by the owner (4) * (0.37)	$17,463
6. Self employment tax (60,000*0.9235*0.029)	$1,607
7. Additional medicare tax (60,000 * 0.9235 * 0.009)	$499
8. Owner level tax. (5)+(6)+(7)	$19,568