Question

There are two methods that California allows for determining the amount of tax that is to...

There are two methods that California allows for determining the amount of tax that is to be withheld from the sales of a home. They are:

Select one:

a. Net Sales Price Method and the Net Gain on Sale Election Method

b. Total Sales Price Method and the Optional Gain on Sale Election Method

c. Total Sales Price Method and the Optional Loss on Sale Election Method

d. Net Sales Price Method and the Optional Gain on Sale Election Method

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Homework Answers

Answer #1

The correct option is (b). Total Sales Price Method and the Optional Gain on Sale Election Method.

Explanation: To calculate the withholdings, the seller can use the following two methods:

Total sales price method:

Multiply the total sales price by 33.33% to calculate the withholding.

Optional Gain on Sale Election Method:

Multiply the estimated gain by the maximum tax rate of the seller to calculate the withholding.

Please take your valuable time and rate the solution as per your convenience.

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