During the current year, Ron and Anne sold the following assets: (Use the dividends and capital gain

 
   

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During the current year, Ron and Anne sold the following assets: (Use the dividends and capital gains tax rates and tax rate schedules.) Capital Asset Market Value Tax Basis Holding Period L stock $ 50,000 $ 41,000 > 1 year M stock 28,000 39,000 > 1 year N stock 30,000 22,000 O stock 26,000 33,000 Antiques 7,000 4,000 > 1 year Rental home 300,000* 90,000 > 1 year

*$30,000 of the gain is 25 percent gain (from accumulated depreciation on the property).

Ignore the Net Investment Income Tax.

Tax Rates for Net Capital Gains and Qualified Dividends Rate* Taxable Income Married Filing Jointly Married Filing Separately Single Head of Household Trusts and Estates 0% $0 – $78,750 $0 – $39,375 $0 – $39,375 $0 – $52,750 $0 – $2,650 15% $78,751 – $488,850 $39,376 – $244,425 $39,376 – $434,550 $52,751 – $461,700 $2,651 – $12,950 20% $488,851+ $244,426+ $434,551+ $461,701+

$12,951+

a. Given that Ron and Anne have taxable income of only $20,000 (all ordinary) before considering the tax effect of their asset sales, what is their gross tax liability for 2019 assuming they file a joint return?

b. Given that Ron and Anne have taxable income of $400,000 (all ordinary) before considering the tax effect of their asset sales, what is their gross tax liability for 2019 assuming they file a joint return?