Cason is filing as single and has 2015 taxable income of $36,000 which includes $34,000 of 0%/15%/20% net long-term capital gain.What is his tax on taxable income using the alternative tax method? Note: Use the tax rate schedule rather than the tax table.
A)$0
B)$200
C)$4,954
D)$300
E)None of the above

Question

Quizplus · Accepted Answer

Cason's taxable income includes $34,000 of long-term capital gains, which are taxed at 0% up to the 15% tax bracket threshold. The remaining $2,000 of ordinary income is taxed at the 10% rate, resulting in $200 tax.

Cason Is Filing as Single and Has 2015 Taxable Income