During 2020, Barton Ferris is entitled to $50,000 in dividends from a publicly listed foreign corporation in which he owns shares. The foreign jurisdiction withholds $10,000 (20%), providing a net receipt of $40,000. In addition to the dividend, Barton has Canadian source rental income of $130,000. He has no tax credits other than his basic personal credit and any credits related to foreign taxes withheld. He has no deductions from Net Income For Tax Purposes in determining Taxable Income. What is the amount of his 2020 Taxable Income?

Question

Quizplus · Accepted Answer

Barton's Taxable Income would include his Canadian rental income of $130,000 and the net amount of his foreign dividend income after the withholding tax, which is $40,000. Therefore, his Taxable Income would be $170,000 ($130,000 + $40,000).

There are no tax credits or deductions mentioned in the scenario that would affect Barton's Taxable Income calculation, so we do not need to consider any adjustments.

Choices A, C, and D are incorrect as they do not reflect the correct calculation of Barton's Taxable Income.

During 2020, Barton Ferris Is Entitled to $50,000 in Dividends