Minnie, a Calendar Year Taxpayer, Filed a Return Correctly Showing

question 30

Multiple Choice

Minnie, a calendar year taxpayer, filed a return correctly showing a zero Federal income tax liability for last year because her Form 1040 showed various deductions and credits. For this tax year, Minnie's AGI is $120,000, and her tax liability is $20,000. To avoid a penalty for the current year, Minnie must make aggregate estimated tax payments of at least:

• A) $20,000.
• B) $18,000.
• C) $1,000 (minimum amount).
• D) $0.

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Definitions:

Behavioral Economics

A field of economics that examines how psychological, social, cognitive, and emotional factors affect economic decisions of individuals and institutions.

Anchoring

The tendency people have to unconsciously base, or “anchor,” the valuation of an item they are currently thinking about on recently considered but logically irrelevant information.

Decision Making

The process of selecting the best course of action from several alternatives to achieve a desired goal.

Irrelevant Information

Data or facts that do not influence decision-making processes in a given context, lacking value for the question or decision at hand.