Question

In 2018, Maria records self-employed earnings of $135,000. Using the format illustrated in the text, compute Maria's self-employment tax liability and the allowable income tax deduction for the self-employment tax paid. Do not round intermediate computations. Round your final answers to the dollar. Maria's self-employment tax liability is____________ $ , and the allowable income tax deduction for the self-employment tax paid is__________________ $ .

Answer 1

Answer:

$19,074.89; $9,537.45

Explanation:

135,000 * 92.35% = 124,672.50 < 127,200

124,672.50 * 15.3% = $19,074.89

19,074.89 * 50% = $9,537.45