For the current year, Salvador's regular tax liability is $17,000, and his tentative alternative minimum tax is $19,000. Salvador has $16,250 withheld from his salary.
I.Salvador has a tax due of $750.
II.Salvador's alternative minimum tax is $0.
III.Salvador has a tax due of $2,750.
IV.Salvador's total tax liability is $19,000

A)Statements I and II are correct.
B)Statements II and III are correct.
C)Statements I, II and IV are correct.
D)Statements III and IV are correct.
E)Statements II, III and IV are correct

Question

For the current year, Salvador's regular tax liability is $17,000, and his tentative alternative minimum tax is $19,000. Salvador has $16,250 withheld from his salary.
I.Salvador has a tax due of $750.
II.Salvador's alternative minimum tax is $0.
III.Salvador has a tax due of $2,750.
IV.Salvador's total tax liability is $19,000
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A)Statements I and II are correct.
B)Statements II and III are correct.
C)Statements I, II and IV are correct.
D)Statements III and IV are correct.
E)Statements II, III and IV are correct

Quizplus · Accepted Answer

Statement III is correct because Salvador's total tax liability is the sum of his regular tax liability and his tentative alternative minimum tax, which equals $36,000 ($17,000 + $19,000). Subtracting the amount withheld from his salary ($16,250) results in a tax due of $2,750.

Statement IV is correct because Salvador's total tax liability is $36,000 ($17,000 +$19,000).

For the Current Year, Salvador's Regular Tax Liability Is $17,000