M104. Calculation of Form W-2, Box 1Jan (single, age 53) is an employee of Lafayette, Inc. In the current year, Jan earns a salary of $74,500 and receives the following fringe benefits:- Health insurance total annual premium = $5,200: Jan pays $500 through withholding; Lafayette, Inc. pays $4,700- Group term life insurance: coverage = $75,000 (all premiums paid by Lafayette, Inc.)- Annual membership dues to a country club = $4,800 (dues paid by Lafayette, Inc.)- (Traditional) 401(k) plan: Jan contributes 10% of her annual salary; Lafayette, Inc. matches employee contributions dollar-for-dollar up to 5% ofannual salaryCalculate Jan's taxable compensation (Box 1 of Form W-2) for the tax year. Enter your answer using the following format: $XX,XXX (i.e., $13,552).Fill in the blank

Form W-2 is related to salaries and tax statements of the employees, and it is mandatorily prepared…

Answered: Calculation of Form W-2, Box 1 Jan…

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter5: Gross Income: Exclusions

Section: Chapter Questions

Problem 2BCRQ

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Linda is an employee of JRH Corporation. Which of the following would be included in Lindas gross income? a. Premiums paid by JRH Corporation for a group term life insurance policy for 50,000 of coverage for Linda. b. 1,000 of tuition paid by JRH Corporation to State University for Lindas masters degree program. c. A 2,000 trip given to Linda by JRH Corporation for meeting sales goals. d. 1,200 paid by JRH Corporation for an annual parking pass for Linda.
Addison Parker (Social Security number 123-45-6785), single and age 32, lives at 3218 Columbia Drive, Spokane, WA 99210. She is employed as regional sales manager by VITA Corporation, a manufacturer and distributor of vitamins and food supplements. Addison is paid an annual salary of 83,000 and a separate travel allowance of 28,000. In order to access the travel allowance, VITA requires adequate accounting by Addison. Addison participates in VITAs contributor) health and 401(k) plans. During 2019, she paid 4,500 for her share of the medical insurance and contributed 11,000 to the 401(k) retirement plan. Addison uses her automobile 70% for business and 30% for personal. The automobile, a Toyota Avalon, was purchased new on June 30, 2017, for 37,000 (no trade-in was involved). Depreciation has been claimed using the MACRS 200% declining-balance method, and no 179 election was made in the year of purchase. (For depreciation information, see the IRS Instructions for Form 4562, Part V.) During 2019, Addison drove 15,000 miles and incurred and paid the following expenses relating to the automobile: Because VITA does not have an office in Spokane, the company expects Addison to maintain one in her home. Out of 1.500 square feet of living space in her apartment, Addison has set aside 300 square feet as an office. Expenses for 2019 relating to the office are listed below. Addisons employment-related expenses (except for the trip to Korea) for 2019 are summarized below. Most of Addisons business trips involve visits to retail outlets in her region. Store managers and their key employees, as well as some suppliers, were the parties entertained. The business gifts were boxes of candy costing 30 (25 each plus 5 for wrapping and shipping) sent to 18 store managers at Christmas. The continuing education was a noncredit course dealing with improving management skills that Addison took online. In July 2019, Addison traveled to Korea to investigate a new process that is being developed to convert fish parts to a solid consumable tablet form. She spent one week checking out the process and then took a one-week vacation tour of the country. The round-trip airfare was 3,600, and her expenses relating to business were 2,100 for lodging (300 each night), 1,470 for meals, and 350 for transportation. Upon returning to the United States, Addison sent her findings about the process to her employer. VITA was so pleased with her report that it gave her an employee achievement award of 10,000. The award was sent to Addison in January 2020. Besides the items already mentioned, Addison had the following receipts in 2019: Regarding the city lot (located in Vancouver), Addison purchased the property in 2004 for 16,000 and held it as an investment. Unfortunately, the neighborhood where the lot was located deteriorated, and property values declined. In 2019, Addison decided to cut her losses and sold the property for 13,000. The sailboat was used for pleasure and was purchased in 2015 for 16,500. Addison sold the boat because she purchased a new and larger model (see below). While at the Spokane airport, Addison found an unmarked envelope containing 55,000 in 50 bills. Because no mention of any lost funds was noted in the media, Addison kept the money. Addisons expenditures for 2019 (not previously noted) are summarized below. Addison keeps careful records regarding sales taxes. In 2019, the sales tax total was unusually high due to the purchase of a new sailboat. In 2019, Addison decided to pay her church pledge for both 2019 and 2020. The insurance premium was on a policy covering her fathers life. (Addison is the designated beneficiary under the policy.) Addisons employer withheld 8,600 for Federal income tax purposes, and she applied her 800 overpayment for 2018 toward the 2019 tax liability. Compute Addisons Federal income tax payable (or refund) for 2019. In making the calculation, use the Fax Rate Schedule and disregard the application of the alternative minimum tax (AMI), which is not discussed until Chapter 12.
Darrell is an employee of Whitneys. During the current year, Darrells salary is 136,000. Whitneys net self-employment income is also 136,000. Calculate the Social Security and self-employment taxes paid by Darrell and Whitney. Write a letter to Whitney in which you state how much she will have to pay in Social Security and self-employment taxes and why she owes those amounts.
Mason Phillips, age 45, and his wife, Ruth, live at 230 Wood lane, Salt lake City, UT 84101. Masons Social Security number is 111-11-1111. Ruths Social Security number is 123-45-6789. Mason and Ruth arc cash basis taxpayers and had the following items for 2019: Salary of 140,000. Had debt of 30,000 from uncollected rent. Collection of unpaid rent from a prior year of 6,000. Sale of 124-i stock resulting in a loss of 105,000. The stock was acquired eight months ago. Rental income of 60,000 (property is managed by Mason and Ruth). Rental expenses of 33,000. Casualty loss on rental property of 10,000. Personal casualty loss (from one event) of 3,000; not in a Federally declared disaster area. Theft loss of 8,000 on a painting held for investment. Other itemized deductions of 21,000. Federal income tax withheld of 3,000. (Compute Mason and Ruths 2019 Federal income tax payable (or refund due).
tes Ms. Ray is age 46 and single. This year, Mr. Ray's retirement savings included a $2,630 employer contribution to a qualified profit- sharing plan account, and a contribution by Ms. Ray to a traditional IRA. Mr. Ray contributed the maximum allowed. Required: a. Compute Ms. Ray's IRA deduction if current year income includes $46,100 salary. b. Compute Ms. Ray's IRA deduction if current year income includes $71,260 salary. c. Compute Ms. Ray's IRA deduction if current year income includes $71,260 salary and $7,290 dividend income. Complete this question by entering your answers in the tabs below. Required A Required B Required C Compute Ms. Ray's IRA deduction if current year income includes $71,260 salary. Note: Do not round phase-out percentage. Round other intermediate values to the nearest whole dollar amount. IRA deduction $ 3,000
Grace's employer is now offering group-termlife insurance. The company will provide each employee with $135.000 of group-term ife Insurance. It costs Grace's employer $725 to provide this amount of insurance to Grace each year. Assuming that Grace is 57 years old, use the table to determine the monthly premium that Grace must include in income as a result of receiving the group-term life benefit. EXHIBIT 12:08 Uniform Premiums for $1,000 of Group-Term Life Insurance Protection 5-Year Age Bracket Under 25 Cost per $1, e0e of Protection for one Month $0.05 25 to 29 0.06 30 to 34 0.08 0.09 0.10 0.15 35 to 39 40 to 44 45 to 49 50 to 54 55 to 59 6e to 64 65 to 69 0.23 0.43 0.66 1.27 2.06 76 and above
Elisa is covered by a $200,000 group term life insurance policy of which her daughter is the sole beneficiary. Elisa's employer pays the entire premium for the policy, for which the uniform annual premium is $0.75 per $1,000 per month of coverage. How much, if any, of the cost of the group term life insurance is excluded from Elisa's gross income on an annual basis? $0 $450 $1,350 $1,800

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