In 2020, Henry Jones (Social Security number 123-45-6789) works as a freelance driver, finding customers using various platforms like Uber and Grubhub. He is single and has no other sources of income. In 2020, Henry's qualified business income from driving is $76,600. Assume Henry takes the standard deduction of $12,400. Click here to access the 2020 individual tax rate schedule to use for this problem. Assume the QBI amount is net of the self-employment tax deduction.a. Compute Henry's QBI deduction and his tax liability for 2020.QBI deduction: $fill in the blank 859e50f64fe9f93_1 12,840Tax liability (round to the nearest dollar): $fill in the blank 859e50f64fe9f93_2b. Complete Henry's 2020 Form 8995 (Qualified Business Income Deduction Simplified Computation). Enter all amounts as positive numbers. 2020 Tax Rate SchedulesSingle-Schedule XHead of household-Schedule ZIf taxableof theIf taxableof theincome is:But notатоuntincome is:But notатоuntOver-over-The tax is:over-Over-over-The tax is:over-2$$ 9,875.10%2$2$$ 14,10010%$.....9,87540,125$987.50 + 12%9,87514,10053,700$ 1,410.00 + 12%14,10040,12585,5254,617.50 + 22%40,12553,70085,5006,162.00 + 22%53,70085,525163,30014,605.50 + 24%85,52585,500163,30013,158.00 + 24%85,500163,300207,35033,271.50 + 32%163,300163,300207,35031,830.00 + 32%163,300207,350518,40047,367.50 + 35%207,350207,350518,40045,926.00 + 35%207,350518,400156,235.00 + 37%518,400518,400154,793.50 + 37%518,400Married filing jointly or Qualifying widow(er)-Married filing separately-Schedule Y-2Schedule Y-1If taxableof theIf taxableof theincome is:But notатоuntincome is:But notатоuntOver-over-The tax is:over-Over-over-The tax is:over-2$$ 19,750.........10%$$$ 9,875.........10%19,75080,250$ 1,975.00 + 12%19,7509,87540,125$987.50 + 12%9,87580,250171,0509,235.00 + 22%80,25040,12585,5254,617.50 + 22%40,125171,050326,60029,211.00 + 24%171,05085,525163,30014,605.50 + 24%85,525326,600414,70066,543.00 + 32%326,600163,300207,35033,271.50 + 32%163,300414,700622,05094,735 .00 + 35%414,700207,350311,02547,367.50 + 35%207,350622,050167,307.50 + 37%622,050311,02583,653.75 + 37%311,025..........

Given: Income = $61,200 Standard deduction = $12,400

Answered: a. Compute Henry's QBI deduction and…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 6C: Intel-period Tax Allocation Chris Green, CPA, is auditing Rayne Co.s 2019 financial statements. For...

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In 2020, Henry Jones (Social Security number 123-45-6789) works as a freelance driver, finding customers using various platforms like Uber and Grubhub. He is single and has no other sources of income. In 2020, Henry's qualified business income from driving is $76,600. Assume Henry takes the standard deduction of $12,400. Click here to access the 2020 individual tax rate schedule to use for this problem. Assume the QBI amount is net of the self-employment tax deduction.

a. Compute Henry's QBI deduction and his tax liability for 2020.

QBI deduction: $fill in the blank 859e50f64fe9f93_1 12,840

Tax liability (round to the nearest dollar): $fill in the blank 859e50f64fe9f93_2

b. Complete Henry's 2020 Form 8995 (Qualified Business Income Deduction Simplified Computation). Enter all amounts as positive numbers.

2020 Tax Rate Schedules
Single-Schedule X
Head of household-Schedule Z
If taxable
of the
If taxable
of the
income is:
But not
атоunt
income is:
But not
атоunt
Over-
over-
The tax is:
over-
Over-
over-
The tax is:
over-
2$
$ 9,875
.10%
2$
2$
$ 14,100
10%
$
.....
9,875
40,125
$
987.50 + 12%
9,875
14,100
53,700
$ 1,410.00 + 12%
14,100
40,125
85,525
4,617.50 + 22%
40,125
53,700
85,500
6,162.00 + 22%
53,700
85,525
163,300
14,605.50 + 24%
85,525
85,500
163,300
13,158.00 + 24%
85,500
163,300
207,350
33,271.50 + 32%
163,300
163,300
207,350
31,830.00 + 32%
163,300
207,350
518,400
47,367.50 + 35%
207,350
207,350
518,400
45,926.00 + 35%
207,350
518,400
156,235.00 + 37%
518,400
518,400
154,793.50 + 37%
518,400
Married filing jointly or Qualifying widow(er)-
Married filing separately-Schedule Y-2
Schedule Y-1
If taxable
of the
If taxable
of the
income is:
But not
атоunt
income is:
But not
атоunt
Over-
over-
The tax is:
over-
Over-
over-
The tax is:
over-
2$
$ 19,750
.........10%
$
$
$ 9,875
.........10%
19,750
80,250
$ 1,975.00 + 12%
19,750
9,875
40,125
$
987.50 + 12%
9,875
80,250
171,050
9,235.00 + 22%
80,250
40,125
85,525
4,617.50 + 22%
40,125
171,050
326,600
29,211.00 + 24%
171,050
85,525
163,300
14,605.50 + 24%
85,525
326,600
414,700
66,543.00 + 32%
326,600
163,300
207,350
33,271.50 + 32%
163,300
414,700
622,050
94,735 .00 + 35%
414,700
207,350
311,025
47,367.50 + 35%
207,350
622,050
167,307.50 + 37%
622,050
311,025
83,653.75 + 37%
311,025
..........

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