Question

Jason and Jill are married and have a six-year-old daughter. During the year, they sell one acre of land for $80,000. Three years ago, they paid $70,000 for two acres of land. Their other income and deductions are as follows: Jill's commissions $82,000 Jason's salary 46,000 Dividend income 5,000 Interest income 8,000 Short-term loss on sale of stock in Nippon Inc. (15,000) 28,000 Deductions for adjusted gross income The standard deduction is $24,000 for married taxpayers filing jointly. The personal and dependency exemptions have been eliminated for 2018. Dividends and net long-term capital gains are taxed at a rate of 15%. Refer to the Tax schedules table to answer the following question. Round intermediate calculations to the nearest dollar. Jason and Jill's taxable income is $ . The tax on their eligible dividends and capital gains is $ and total income tax liability is $ for the current year.

Answer 1

Jill's commissions	$   82,000
Jason's salary	$   46,000
Dividend income	$     5,000
Interest income	$     8,000
Net long-term capital gain	$   30,000
Gross Income	$ 171,000
Deductions for adjusted gross income	$   28,000
Adjusted gross income	$ 143,000
Standard Deduction	$   24,000
Taxable Income	$ 119,000
Tax on Dividends and Capital Gains (35000*15%)	$     5,250
Taxed at ordinary rates $84,000	$   10,359
W.N
Long-term capital gain	$   45,000
Less: Short-term capital loss	$ -15,000
Net long-term capital gain	$   30,000
Taxed at ordinary rates
19050*10%	$     1,905
(77400-19051)*12%	$     7,002
(84000-77401)*22%	$     1,452
	$   10,359