1. Corinne's employer offers a cafeteria plan that allows employees to choose among a number of benefits. Each employee is allowed $12,000 in benefits. For the current year, Corinne selected $4,500 of health insurance, $5,500 of dependent care, $1,000 in 401(k) contributions, and $1,000 of cash.

How much must Corinne include in taxable income?

2. Alison Jacobs (single) purchased a home in Las Vegas, Nevada for $400,000. She moved into the home on September 1, year 0. She lived in the home as her primary residence until July 1 of year 4 when she sold the home for $675,000.

If Alison's marginal ordinary tax rate is 25% what amount of tax will Alison pay on the $275,000 gain?

Answer rating: 100% (QA)

1 1500 Employees can exclude up to 5000 of ... View the full answer