Standard deduction for individual: $6,100 Standard deduction for married couples
ID: 2609361 • Letter: S
Question
Standard deduction for individual: $6,100
Standard deduction for married couples filing jointly: $12,200
Quantitative Problem: Jenna is a single taxpayer with no dependents so she qualifies for one personal exemption. During 2013, she earned wages of $109,000. She doesn't itemize deductions, so she will take the standard deduction and her personal exemption to calculate 2013 taxable income. In addition, during the year she sold common stock that she had owned for five years for a net profit of $6,100. How much does Jenna owe to the IRS for taxes? Round your intermediated and final answers to the nearest cent.
$
If Your Taxable Income Is You Pay This
Amount on the
Base of the Bracket Plus This Percentage
on the Excess over the
Base (Marginal Rate) Average Tax
Rate at
Top of Bracket Up to $8,925 $0 10.0% 10.0% $8,925 - $36,250 892.50 15.0 13.8 $36,250 - $87,850 4,991.25 25.0 20.4 $87,850 - $183,250 17,891.25 28.0 24.3 $183,250 - $398,350 44,603.25 33.0 29.0 $398,350 - $400,000 115,586.25 35.0 29.0 Over $400,000 116,163.75 39.6 39.6
Explanation / Answer
Computation of taxable income Wages $109,000 Long yerm capital gain $6,100 Less: Standard deduction -6100 Less personal exemption -3900 Taxable income $105,100 Tax Liability Long term capital gain (6100*15%) 915 Tax on remaining income of $99000 (105100-6100) 17891.25+(28%*(99000-87850)) 21013.25 Total tax liability 21928.25 ans rounded off 21928 ans If any doubt please comment
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