Sara Is Filing as Head of Household and Has 2011

question 74

Multiple Choice

Sara is filing as head of household and has 2011 taxable income of $27,000 which includes $13,000 of net long-tem capital gain.The net long-term capital gain is made up of $10,000 25% gain and $3,000 0%/15% gain.What is the tax on her taxable income using the alternative tax method?

• A) $0.
• B) $3,993.
• C) $2,993.
• D) $3,443.
• E) None of the above.

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Definitions:

Primarily Liable

Being directly responsible or obligated in a legal or financial context, often referring to the party most accountable for fulfilling an obligation.

Authorized

Having official permission or power to do something or for something to take place.

Accepted Draft

An agreement or negotiable instrument that has been formally acknowledged by the addressee, promising to pay the specified amount by a certain date.

Obligated

Being legally or morally required to do something based on laws, regulations, agreements, or ethical principles.