Robert's marginal tax rate is 37% and his average tax rate is 20%. Robert is considering making a $10,000 charitable contribution at year-end. Which of the following is true? A. Making the charitable contribution could save him $3,700 in taxes. B. His "true" after-tax cost of the charitable contribution is $8,000 assuming he itemizes. C. If he takes the standard deduction, the charitable contribution will have no effect on his taxes. D. A and C are true. E. B and C are true.
B. His "true" after-tax cost of the charitable contribution is $8,000 assuming he itemizes.
Robert's marginal tax rate is 37% and his average tax rate is 20%. Robert is considering...
25. Your client's federal marginal income tax rate is 35%, and his state marginal income tax rate is 5%. He is considering investing in a municipal bond issued by his local municipality that will yield him 6%. Calculate the taxable equivalent yield of this bond. A. 3.60% B. 8.40% C. 9.23% D. 10.00%
6. Oliver, who is single, has come to you for tax advice. He says under the recent tax legislation he is never able to benefit by itemizing his deductions. He tells you that with the standard deduction being around $12,000, and with his home mortgage interest, taxes, and charitable contributions only coming to $11,500, he takes the standard deduction. Each year he gives $5,000 to his church, and that is his only charitable contribution. He wants to know if you...
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. 37 How will this oversight affect his federal tax bill in 2019 (specify dollar amount in your answer)? Work: 38 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)? 39 Work: 40 41
1. Kenneth has an adjusted gross income of $114000. His Schedule A expenses were as follows: • Interest on home mortgage, $12500 • Property taxes on home, $4000 • State income tax, $8000 • Charitable contributions, $1000 What will he be able to claim for total itemized deductions? A) $23500 B) He should take the standard deduction. C) $13500 D) $25500 2. Nicole sold shares of Disney Company that were given to her 20 years ago by her grandmother to...
24. Impact on Taxes. James has a marginal tax rate of 12%. He suddenly realizes that he neglected to include a $7,500 tax deduction. How will this oversight affect his taxes? From question A, if James had forgotten a $7,500 tax credit (instead of a $7500 tax deduction), how would his taxes be affected?
Suppose Gary gets 12% return on his investment before tax. If his marginal tax rate is 12% then, what is he actually making after tax (what is the after tax return)? Answer: Check
Suppose Gary gets 5% return on his investment before tax. If his marginal tax rate is 10% then, what is he actually making after tax (what is the after tax return)? Answer: Check
Ramon had AGI of $218,000 in 2019. He is considering making a charitable contribution this year to the American Heart Association, a qualified charitable organization. Determine the current allowable charitable contribution deduction in each of the following independent situations, and indicate the treatment for any amount that is not deductible currently. Identify any planning ideas to minimize Ramon's tax liability. a. A cash gift of $109,000. In the current year, Ramon may deduct $ since his charitable contribution is limited...
Problem 10-34 (Algorithmic) (LO. 6, 8) Ramon had AGI of $166,000 in 2020. He is considering making a charitable contribution this year to the American Heart Association, a qualified charitable organization. Determine the current allowable charitable contribution deduction in each of the following independent situations, and indicate the treatment for any amount that is not deductible currently. Identify any planning ideas to minimize Ramon's tax liability. a. A cash gift of $83,000. In the current year, Ramon may deduct $...
Ann s average income tax rate is 30%, and her marginal income tax rate is 37%. Her property tax bill for 2015 was $12,000 and her total interest payment on her mortgage was $9,500. Based on this information, what is Ann s total income tax shield (i.e. how much is Ann saving on her income taxes)