Question

please solve this problem and provide the formula used

Tax Rates 10% 15% 25% Individual Returns $0 to $9,075 $9,076 to $36,900 $36,901 to $89,350 $89,351 to $186,350 $186,351 to $405,100 $405,101 to $406,750 Joint Returns $0 to $18, 150 $18,151 to $73,800 $73,801 to $148,850 $148,851 to $226,850 $226,851 to $405,100 $405,101 to $457,600 28% 33% 35% 15) In 2015, John and Nicole earned a combined taxable income of $148,800 from employment plus $1,000 in long term capital gains and they file a joint tax return. What is their total federal income tax? Round to the nearest dollar. A) $37,150 B) $29,063 C) $29,593 D) $28,963 Answer: B I carning Outcome: F-01 Describe the different financial markets and the role of the financial

Answer 1

Computation of Taxable Income:-

Taxable Income from employment = $148,800

Add: Long term capital gain = $1,000

Taxable Income: $149,800

Since John and Nicole fall in 25% tax bracket. So Long term capital gain will be taxed at the rate of 15%.

Computation of Federal Income Tax 10% Up to $18,150 15% $18,150 to $73,800 25% 73,800 to $ 148,800 1815 8347-5 18750 28912.5 150 Long Term Capital Gain (1000*15%) Total Federal Income Tax 29063