Jake and Christina Are Married and File a Joint Return

question 107

Multiple Choice

Jake and Christina are married and file a joint return for 2016 with taxable income of $100,000 and tax preferences and adjustments of $20,000 for AMT purposes.Their regular tax liability is $16,533.What is the amount of their total tax liability?

• A)$7,121
• B)$9,412
• C)$16,533
• D)$25,945

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Definitions:

Capital Balance

The amount of money that owners have invested in a firm minus any withdrawals made by the owners.

Capital Balance

The capital balance in a company's equity section represents the owner's investment, adjusted for withdrawals and profits or losses.

Withdraws

Money taken out from a business by its owners for personal use.

Bonus Distribution

The payout of extra compensation to employees or partners beyond their regular earnings.