Question

Autumn and Winter are married with no dependents and file a joint return for 2018. They had the following for 2018:

	Sales Price	Basis
Sale of 100 shares of purchased SunRun stock held 3 years	$ 6,000	$ 4,900
Sale of 50 shares of inherited GM stock held 5 months	6,000	6,400
Interest from bank savings account	2,100	n/a
Qualifying dividends	2,200	n/a

Autumn and Winter’s taxable income is $76,500. How much is their gross tax? Show your work.

Answer 1

Gross tax computation for 2018

Particulars	Note No	Amount (in $)
Total Taxable Income		76500
Less:
Capital gain	1	700
Qualifying dividends		2200
Total taxable income (After adjustments)		73600
Tax Rates
Upto $19,050- 10%		1905
19,051-77,400-12%		6546
Tax on CG and Dividend Tax rate for those who are in lower tax brackets is -15%	(700+2200)*15/100	435
Gross tax		8886

Note No-1:

Particulars	Sale Price	Purchase Price	Net Gain/(loss)
Sale of 100 Shares	$6000	$4900	$1100
Sale of 50 Shares	$6000	$6400	($400)
Total Net Gain			700