Exam 14: Special Tax Computation Methods, tax Credits, and Payment of Tax

Beth and Jay project the following taxes for the current year: In order to avoid underpayment penalties,between withholding from wages and quarterly estimated payments,Beth and Jay should pay in at least (assume the following prior year amounts): a.AGI of $140,000 and total taxes of $36,000. b.AGI of $155,000 and total taxes of $50,000.

An individual with AGI equal to or less than $150,000 in the prior year may generally avoid penalties for underpayment of estimated tax in each of the following cases with the exception of

Self-employment taxes include components for

A corporation has $100,000 of U.S.source taxable income and $300,000 of foreign source taxable income from countries X and Y for a total worldwide taxable income of $400,000.Countries X and Y levy a total of $60,000 in foreign taxes upon the foreign source taxable income.U.S.taxes before credits are $140,000.The foreign tax credit limitation is

Ivan has generated the following taxes and credits this year: How much general business credit will he apply to the current year tax liability?

Individuals without children are eligible for the earned income credit if they meet all the following conditions except

The adoption credit based on qualified adoption expenses is generally allowed in the year the adoption is finalized.

For purposes of the AMT,only the foreign tax credit and refundable personal credits are allowed to reduce the tentative minimum tax.

Qualified tuition and related expenses eligible for the American Opportunity Tax Credit are limited to those incurred the first two years of postsecondary education.

Discuss when Form 6251,Alternative Minimum Tax,must be filed.