Range of BenefitsBob, a 66 years old worker, is deciding between retirement either this year or the next year. His average monthly benefit is determined to be$1,635.40. Assume that the benefit is the same for this year and the next year.Compute Bob's annual benefit reduction amounts in each of the following scenarios.• If Bob retires this year and secures a part-time job earning $19,000, his annual benefit reduction amount is• If Bob retires this year, secures the same part-time job, and in addition projects interest and dividend earnings of $7,000 per year, what his annualbenefit reduction amount is $• If Bob retires next year and secures the same part-time job, the annual benefit reduction amount is STaxes on BenefitsSocial Security is paid in with after-tax dollars but may be subject to tax if annual income exceeds a base amount. A single taxpayer's base i$25,000. Married taxpayers filing jointly have a base of $32,000. Married taxpayers filing separately have a base of zero.Suppose Eric is retiring this year at age 67. The following table shows his data.Part-time salary $30,500Annual savings account interest$300Annual dividends $2,750 Annual interest on Dallas municipal bonds $1,550Based on the income calculated, Eric will have% of his Social Security benefits taxed. RAJIV: I heard the HR manager say that they offer two supplemental plans, but I only wrote down the profit-sharing plan. Under this type ofplan, your account does not depend on the company's performance. This is because when profits are low, the company makeslargerlessdo not setdepends_smaller contributions to the plan, and when profits are high, it pays more. However, employersmaximum amounts to be paid as contributions. What is the other plan?ERISASIMONE: The other plan she mentioned isthe traditional 401(k) planthe Pension Protection ActRAJIV: Because our employer is a big Fortune 500 company, our plan is voluntary. It takes everyone'sin company stock.setRAJIV: Agreed. Thanks for helping me complete my notes!benefitscontributionsminimum andand heavily invests iSIMONE: Well, I think I have my notes complete. I may need to clarify a few things that will apply just to me, vesting, profit-sharingpercentages, and retirement age.

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Range of Benefits Bob, a 66 years old worker, is deciding between retirement either this year or the next year. His average monthly benefit is determined to be $1,635.40. Assume that the benefit is the same for this year and the next year. Compute Bob's annual benefit reduction amounts in each of the following scenarios. • If Bob retires this year and secures a part-time job earning $19,000, his annual benefit reduction amount is • If Bob retires this year, secures the same part-time job, and in addition projects interest and dividend earnings of $7,000 per year, what his annual benefit reduction amount is S • If Bob retires next year and secures the same part-time job, the annual benefit reduction amount is S Taxes on Benefits

Range of Benefits Bob, a 66 years old worker, is deciding between retirement either this year or the next year. His average monthly benefit is determined to be $1,635.40. Assume that the benefit is the same for this year and the next year. Compute Bob's annual benefit reduction amounts in each of the following scenarios. • If Bob retires this year and secures a part-time job earning $19,000, his annual benefit reduction amount is • If Bob retires this year, secures the same part-time job, and in addition projects interest and dividend earnings of $7,000 per year, what his annual benefit reduction amount is S • If Bob retires next year and secures the same part-time job, the annual benefit reduction amount is S Taxes on Benefits

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter6: Business Expenses

Section: Chapter Questions

Problem 58P

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