PRINCIPLES OF TAXATION F/BUS.+INVEST.
22nd Edition
ISBN: 9781259917097
Author: Jones
Publisher: MCG
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Chapter 2, Problem 7AP
7 a
To determine
Determine the decrease in revenue that government collects from Mr. and Mrs. BK.
7 b
To determine
Determine the decrease in revenue that the government collects if Mr. and Mrs. BK respond to the rate decrease by working harder and earnings by $375,000 taxable income.
7 c
To determine
Determine the decrease in revenue that the government collects if Mr. and Mrs. BK respond to the rate decrease by working harder and earnings by $275,000 taxable income.
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Students have asked these similar questions
7) Ms. Benoit is a self-employed architect who earns $300,000 annual taxable income. For the past several years, her tax rate on this income has been 35 percent. Because of recent tax law changes, Ms. Benoit’s tax rate for next year will decrease to 25 percent.
a) Based on a static forecast, how much less revenue will the government collect from Ms. Benoit next year?
b) How much less revenue will the government collect from Ms. Benoit next year if she responds to the rate decrease by working more hours and earning $375,000 taxable income?
c) How much less revenue will the government collect from Ms. Benoit next year if she responds to the rate decrease by working fewer hours and earning only $275,000 taxable income?
The Roosevelt's are financially savvy and want to take advantage of the principle of bunching. Assume
for this problem, that the Roosevelts expect to pay $14,000 in tithing and $8,000 in state and local
taxes for the next few years (these are their only itemized deductions). How much would bunching
save them over the course of two years if their marginal tax rate is 22%? (The standard deduction for
a married filing jointly taxpayer is $24,000.)
$12,000
$4,840
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"Mr. and Mrs. Jerald own a dry cleaning business that generates $125,000 taxable income each year. For the past few years, the couple’s federal tax rate on this income has been 32 percent. Congress recently increased the tax rate for next year to 40 percent.
Based on a static forecast, how much additional revenue will the federal government collect from Mr. and Mrs. Jerald next year?
How much additional revenue will the government collect if Mr. and Mrs. Jerald respond to the rate increase by working harder and earning $140,000 next year?
How much additional revenue will the government collect if Mr. and Mrs. Jerald respond to the rate increase by working less and earning only $110,000 next year?
"
Chapter 2 Solutions
PRINCIPLES OF TAXATION F/BUS.+INVEST.
Ch. 2 - What evidence suggests that the federal tax system...Ch. 2 - Prob. 3QPDCh. 2 - National governments have the authority to print...Ch. 2 - In each of the following cases, discuss how the...Ch. 2 - Prob. 6QPDCh. 2 - Ms. V resides in a jurisdiction with a 35 percent...Ch. 2 - What nonmonetary incentives affect the amount of...Ch. 2 - Prob. 9QPDCh. 2 - Prob. 10QPDCh. 2 - Discuss the tax policy implications of the saying...
Ch. 2 - Prob. 12QPDCh. 2 - Jurisdiction E spends approximately 7 million each...Ch. 2 - Prob. 14QPDCh. 2 - Prob. 15QPDCh. 2 - Corporation R and Corporation T conduct business...Ch. 2 - Ms. P is considering investing 20,000 in a new...Ch. 2 - Country M levies a 10 percent excise tax on the...Ch. 2 - The city of Lakeland levies a 2 percent tax on the...Ch. 2 - The city of Clement levies a 5 percent tax on the...Ch. 2 - Mrs. K, a single taxpayer, earns a 42,000 annual...Ch. 2 - Prob. 5APCh. 2 - Prob. 6APCh. 2 - Prob. 7APCh. 2 - Jurisdiction B levies a flat 7 percent tax on the...Ch. 2 - Jurisdiction X levies a flat 14 percent tax on...Ch. 2 - Prob. 10APCh. 2 - Prob. 11APCh. 2 - Country A levies an individual income tax with the...Ch. 2 - Prob. 13APCh. 2 - Prob. 14APCh. 2 - Prob. 1IRPCh. 2 - Identify the tax issue or issues suggested by the...Ch. 2 - Prob. 3IRPCh. 2 - Prob. 4IRPCh. 2 - Prob. 5IRPCh. 2 - Prob. 6IRPCh. 2 - Prob. 1TPC
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