Question

1. Lexxi is a single taxpayer. This year, her taxable income is $91,000, which includes $6,000 long-term capital gain. What is Lexxi’s tax liability?

2. Instead, assume Lexxi’s total taxable income is $45,000, which includes $12,000 long-term capital gain. What is Lexxi’s tax liability?

3. Andy is a single taxpayer. This year, his taxable income is $95,000, which includes $8,000 long-term capital gain. What is Andy’s tax liability?

4. Instead, assume Andy’s total taxable income is $40,000, which includes $8,000 long-term capital gain. What is Andy’s tax liability?

Answer 1

Sol1		$	$
Lexxis taxable income			85000
Longterm capital gain		6000
Less: 15% on capital gain		900	5100
Total taxable income			90100
Tax Liability	Tax %
upto $38700	12	4644
Upto $38701-82500	22	12628
Upto $82501-90100	24	1824
Total tax liability		19096
Sol2		$	$
Lexxis taxable income			33000
Longterm capital gain		12000
Less: 15% on capital gain		1800	10200
Total taxable income			43200
Tax Liability	Tax %
upto $38700-	12	4644
Upto $38701-43200	22	990
Total tax liability		5634
Sol3		$	$
Andy's taxable income			87000
Longterm capital gain		8000
Less: 15% on capital gain		1200	6800
Total taxable income			93800
Tax Liability	Tax %
upto $38700-	12	4644
Upto $38701-82500	22	12628
Upto $82501-93800	24	2712
Total tax liability		19984
Sol4		$	$
Andy's taxable income			32000
Longterm capital gain		8000
Less: 15% on capital gain		1200	6800
Total taxable income			38800
Tax Liability	Tax %
upto $38700-	12	4644
Upto $38701-38800	22	22
Total tax liability		4666