Question

In: Accounting

Phil, 35 years old is an accountant. He receives medical insurance and fringe benefits from the...

  • Phil, 35 years old is an accountant. He receives medical insurance and fringe benefits from the employee. His wife, Sharon is 33 years old and works part time as office manager. They have 1 child, Amy 4 years old (qualifies for the $2,000 child care credit. They live in NYC and Sharon’s mother cares for Amy at no cost.  

Assume Phil and Sharon sold their primary residence in the current year. They meet all of the requirements to qualify for exclusion provisions afforded to home owners.  They paid $285,000 to purchase the house. They sold the house for $900,000. How much of gain on the sale of their primary home is subject to tax?

Solutions

Expert Solution

Ans: Since The primary residence exclusion can exempt as much as $500000 of net profit from capital gains tax for married couples filing jointly

Sale proceeds= $900,000

Purchase price of the property= 285,000

Gain on sale of primary home subjected to Tax= (Sale proceeds- purchase price of the property)- $500,000

= 900,000-285,000)-500,000

=$115,000

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Phil, 35 years old is an accountant. He receives medical insurance and fringe benefits from the...
Phil, 35 years old is an accountant. He receives medical insurance and fringe benefits from the employee. His wife, Sharon is 33 years old and works part time as office manager. They have 1 child, Amy 4 years old (qualifies for the $2,000 child care credit. They live in NYC and Sharon’s mother cares for Amy at no cost.   Phil’s Gross salary $56,400 Sharon’s salary $22,000 Cash gift $5,000 Interest Income from bank acc $100 Federal income tax w/h $2,500...
Phil Frugal has been saving his pennies in penny jars since he was 5 years old....
Phil Frugal has been saving his pennies in penny jars since he was 5 years old. He is now 45 and deposits his savings in a bank, His pennies total $5000. Using this information and your knowledge of the banking system, place the definition and dollar amounts below in their appropriate bins. (Assume a required reserve ratio of 10%.)
For what reasons would employees demand and employers grant fringe benefits such as insurance, pension, and...
For what reasons would employees demand and employers grant fringe benefits such as insurance, pension, and health programs instead of simply increasing wage rates?
Rick is currently 35 years old. He plans to retire at age 65 and hopes to...
Rick is currently 35 years old. He plans to retire at age 65 and hopes to live to age 85. His labour income is $50,000 per year, and he intends to maintain a constant level of real consumption spending over the next 50 years. Assuming a real interest rate of 3% per year, no taxes, and no growth in real labour income, what is the value of Rick’s human capital? ****I would like this broken down step by step, and...
Michael is single and 35 years old. He is a participant in his employer’s sponsored retirement...
Michael is single and 35 years old. He is a participant in his employer’s sponsored retirement plan. How much can Michael contribute to a Roth IRA in 2019 in each of the following alternative situations? (Leave no answer blank. Enter zero if applicable.) a. Michael’s AGI before the IRA contribution deduction is $55,000. Michael contributed $3,200 to a traditional IRA. b. Michael’s AGI is $85,000 before any IRA contributions. c. Michael’s AGI is $129,000 before any IRA contributions. A. Contribution...
An employee who will be 40 years old on April 1 receives group-term life insurance coverage...
An employee who will be 40 years old on April 1 receives group-term life insurance coverage of $75,000. How much taxable income must this employee recognize for January 2017? a.$2.50 b.$2.75 c.$12.75 d.$4.25
Phil Nelson, 19 year old, was brought to the ER following a near-drowning. He was not...
Phil Nelson, 19 year old, was brought to the ER following a near-drowning. He was not breathing when the paramedics pulled him out of the lake. CPR was given and he awoke. Upon arrival to the ER, he was extremely anxious with a BP of 118/62 and respiratory rate of 26. He was alert and oriented X 3 and the nurse auscultated crackles along with expiratory wheezing throughout all lung fields. A 40% face mask was applied and his ABGs...
Walter is retired and is paying for long-term care insurance. He is 65 years old and...
Walter is retired and is paying for long-term care insurance. He is 65 years old and pays $4,200 in long-term care insurance premiums and incurred $2,350 worth of long-term care insurance expenses in 2018. If Walter's AGI is $23,500, how much of the long-term car einsurance premiums and expenses can Walter deduct on Schedule A?
A client, 35 years old, who would like to retire at age 65 (30 years from...
A client, 35 years old, who would like to retire at age 65 (30 years from today). Her goal is to have enough in her retirement account to provide an income of $75,000 a year, starting a year after retirement or year 31, for 25 years thereafter. She had a late start on saving for retirement, with a current balance of $10,000. To catch up, she is now committed to saving $5,000 a year, with the first contribution a year...
List and describe 9 employee fringe benefits that are excluded from income. Give an example of...
List and describe 9 employee fringe benefits that are excluded from income. Give an example of the each benefit and any rules and limitations on the income tax exclusion.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT