In 2000, Ms. Ennis, a head of household, contributed $50,000 in exchange for 500 shares of Seta
Question:
In 2000, Ms. Ennis, a head of household, contributed $50,000 in exchange for 500 shares of Seta stock. Seta is a qualified small business. This year, Ms. Ennis sold all 500 shares for $117,400. Her only other investment income was an $8,600 long-term capital gain from the sale of land. Her taxable income before consideration of her two capital transactions is $590,000.
a. Compute Ms. Ennis's income tax and Medicare contribution tax for the year.
b. How would the computation change if Ms. Ennis acquired the Seta stock in 2011 instead of 2000?
c. How would the computation change if Ms. Ennis acquired the Seta stock in 2015 instead of 2000?
Step by Step Answer:
Principles Of Taxation For Business And Investment Planning 2018
ISBN: 9781259713729
21st Edition
Authors: Sally Jones, Shelley C. Rhoades Catanach, Sandra R Callaghan