Jane has $2,000 of dividend income and $3,000 of capital gains in her equity investment in 2020. Her marginal tax rate is 40% and the effective tax rate is 30% for the same year. Calculate the amount of tax she'll pay on her dividend income and capital gains combined from her equity investment. Assume that she is not eligible for the dividend tax credit.
Jane has $2,000 of dividend income and $3,000 of capital gains in her equity investment in 2020. Her marginal tax rate is 40% and the effective tax rate is 30% for the same year. Calculate the amount of tax she'll pay on her dividend income and capital gains combined from her equity investment. Assume that she is not eligible for the dividend tax credit.
Chapter3: Income Sources
Section: Chapter Questions
Problem 65P
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Transcribed Image Text:Jane has $2,000 of dividend income and
$3,000 of capital gains in her equity
investment in 2020. Her marginal tax rate is
40% and the effective tax rate is 30% for the
same year. Calculate the amount of tax she'll
pay on her dividend income and capital gains
combined from her equity investment.
Assume that she is not eligible for the
dividend tax credit.
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