Mr. Lay, who has a 39.6 percent marginal tax rate, earned a $22,030 dividend on his investment

Question:

Mr. Lay, who has a 39.6 percent marginal tax rate, earned a $22,030 on his investment in Rexford Mutual Fund. Compute the income tax and the Medicare contribution tax on this if his Form 1099 reported that:
a. The entire $22,030 was an ordinary $17,540 was an ordinary and $4,490 was a capital gain distribution.
c. $6,920 was an ordinary $10,620 was a qualified distribution, and $4,490 was a capital gain distribution.
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...