Answered: Calculate the amounto of self…

Business

Accounting

Calculate the amounto of self -employment tax that Aaron will be required to pay for the tax year 2020.

Income Tax Fundamentals 2020

38th Edition

ISBN:9780357391129

Author:WHITTENBURG

Publisher:WHITTENBURG

Chapter9: Payroll, Estimated Payments, And Retirement Plans

Section: Chapter Questions

Problem 13MCQ

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Concept explainers

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.

Question

Aaron owns and operates a shipping business. He had gross income of $ 345,00 and expenses totaling of $ 150,000. Calculate the amounto of self -employment tax that Aaron will be required to pay for the tax year 2020.

- $ 17,075

- $ 22,297

- $ 27,553

- $ 29835

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