Omar (single) is e
Chapter3: Computing The Tax
Section: Chapter Questions
Problem 38P
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![Required information
[The following information applies to the questions displayed below.)
Omar (single) is a 50 percent owner in Cougar LLC (taxed as a partnership). Omar works half time for Cougar and receives
guaranteed payment of $50,000. Cougar LLC reported $450,000 of business income for the year (2023). Before
considering his 50 percent business income allocation from Cougar and the self-employment tax deduction (if any).
Omar's adjusted gross income is $210,000 (includes $50,000 guaranteed payment from Cougar and $180,000 salary from
a different employer). Omar reports itemized deductions of $40,000. Answer the following questions for Omar.
Note: Leave no answer blank. Enter zero if applicable. Round your intermediate calculations and final answers to the
nearest whole dollar.
c. Assume the original facts and that the business income allocated to Omar is not from a specified service. What is Omar's deduction
for qualified business income? Assume that 81.82 percent of the self-employment tax is from self-employment income included in QBI
[Le, $225,000 business income allocation $275,000 (business income allocation plus guaranteed payment)]. That is, the $50,000
guaranteed payment is not qualified business income. Ignore the wage-based limitation.
Deduction for qualified business income
$
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Transcribed Image Text:Required information
[The following information applies to the questions displayed below.)
Omar (single) is a 50 percent owner in Cougar LLC (taxed as a partnership). Omar works half time for Cougar and receives
guaranteed payment of $50,000. Cougar LLC reported $450,000 of business income for the year (2023). Before
considering his 50 percent business income allocation from Cougar and the self-employment tax deduction (if any).
Omar's adjusted gross income is $210,000 (includes $50,000 guaranteed payment from Cougar and $180,000 salary from
a different employer). Omar reports itemized deductions of $40,000. Answer the following questions for Omar.
Note: Leave no answer blank. Enter zero if applicable. Round your intermediate calculations and final answers to the
nearest whole dollar.
c. Assume the original facts and that the business income allocated to Omar is not from a specified service. What is Omar's deduction
for qualified business income? Assume that 81.82 percent of the self-employment tax is from self-employment income included in QBI
[Le, $225,000 business income allocation $275,000 (business income allocation plus guaranteed payment)]. That is, the $50,000
guaranteed payment is not qualified business income. Ignore the wage-based limitation.
Deduction for qualified business income
$
0
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ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT