info: Lexi, a single taxpayer, reports the following items for 2017 ?(Click the
ID: 1174914 • Letter: I
Question
info:
Lexi, a single taxpayer, reports the following items for 2017 ?(Click the icon to view the items reported in 2017) Requirements a. What is the amount of Lexi's self-employment tax? b. How would your answer to Part a change if Lexi's salary were $145,000? Requirement a. What is the amount of Lexi's self-employment tax? (Round all currency amounts to the nearest whole dollar. Enter a "O" for any zero balances. Abbreviations used: SE-self-employment tax, OASDI old-age, survivors, and disability insurance, Hl hospital insurance [Medicare].) 2017: SE tax for OASDI SE tax for H Total SE tax Requirement b. How would you answer to Part a change if Lexi's salary were $145,000? (Round all currency amounts to the nearest whole dollar. Complete all answer boxes. Enter a 0 for any zero balances. Abbreviations used. SE = self-employment tax; OASD-old-age survivors, and disability insurance: H-hospital insurance [Medicare].) 2017: SE tax for OASDI SE tax for H Total SE taxExplanation / Answer
a). Net earnings = 25000 + 26000 +8000 - 13000 = 46,000
46,000 * 92.35% = 42,481. (50% deduction on self employment tax, that is 50% of 15.3%)
42,481 * 12.4% = 5,267.64 = OASDI
42,481 * 2.9% = 1231.949 = Medicare
= 6,499.589 = Total SE Tax
b).Lexi's income were 145,000
145,000 * 92.35% =133,907.5 (50% deduction on self employment tax, that is 50% of 15.3%)
128,400 * 12.4% = 15,921.6 = OASDI (applies to first 128,400 earned income per year)
133,907.5 * 2.9% = 3,883.3175 = Medicare
= 19,804.9175 = Total SE Tax
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