In: Accounting
Kyle, a single taxpayer, worked as a free-lance software
engineer for the first three months of 2019. During that time, he
earned $64,000 of self-employment income. On April 1, 2019, Kyle
took a job as a full-time software engineer with one of his former
clients, Hoogle Inc. From April through the end of the year, Kyle
earned $184,000 in salary.
What amount of FICA taxes (self-employment and employment related)
does Kyle owe for the year? (Round your intermediate
calculations to the nearest whole dollar amount.)
[The following information applies to the questions
displayed below.]
This year Lloyd, a single taxpayer, estimates that his tax
liability will be $10,450. Last year, his total tax liability was
$15,300.
He estimates that his tax withholding from his employer will be
$8,085.
rev: 02_29_2020_QC_CS-202942
a. How much does Lloyd need to increase his withholding by (for the year), in order to avoid the underpayment penalty?
This year Lloyd, a single taxpayer, estimates that his tax
liability will be $10,450. Last year, his total tax liability was
$15,300.
He estimates that his tax withholding from his employer will be
$8,085.
rev: 02_29_2020_QC_CS-202942
b. Assuming Lloyd does not make any additional payments, what is the amount of his underpayment penalty? Assume the federal short-term rate is 5 percent. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)