Mr. and Mrs. Reid, ages 55 and 50, received the following income during 2012:
Mr. Reid:
Employment income (commission) ........................................................ $15,000
Employment expenses ....................................................................... (13,000)
Investment income: .......................................................................................
Canadian interest ................................................................................. 2,000
Dividends received (in Cdn. $): ........................................................................
Canadian-resident public corporations ....................................................... 1,000
U.S. corporations (net of 15% withholding tax) .............................................. 680
Mrs. Reid:
Employment income .......................................................................... 54,000
Investment income: .....................................................................................
Canadian interest ............................................................................... 1,000
Dividends received from Canadian-resident public corporations ........................ 2,000
REQUIRED
Calculate Mrs. Reid's federal tax (ignoring the foreign tax credit) under the following situations:
(A) No election to include spousal dividends.
(B) With an election to include spousal dividends.