Question

In 2018, Simon, age 12, has interest income of $8,960 and no earned income. He has...

In 2018, Simon, age 12, has interest income of $8,960 and no earned income. He has no investment expenses.

If required, round the tax liability to the nearest dollar.

1.Net unearned income is $_____

2. Simon's total tax is______

Homework Answers

Answer #1
1 Net unearned Income = $       6,860
2 Simon's total tax = $       1,142
Workings:
1 Net unearned Income = Net unearned Income - Threshold for 2018
= $8960 - $2100
= $       6,860
2 Simon's total tax = ($3600 X 10%) + [($6860 - $3600) X 24%]
= ($3600 X 10%) + ($3260 X 24%)
= $       1,142
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