Perry is in the 33% tax bracket.During 2012,he had the following capital asset transactions: Perry's tax consequences from these gains are as follows:

Question

Perry is in the 33% tax bracket.During 2012,he had the following capital asset transactions:  Perry's tax consequences from these gains are as follows:

Quizplus · Accepted Answer

The tax consequences from the gains are as follows:
- The gain from the sale of stock is long-term, so it is taxed at a maximum rate of 15%. Therefore, Perry owes (15% * $10,000) = $1,500 in taxes on this gain.
- The gain on the sale of the land is also long-term, so it is taxed at a maximum rate of 15%. Therefore, Perry owes (15% * $30,000) = $4,500 in taxes on this gain.
- The gain on the sale of the rental property is short-term, so it is taxed at Perry's ordinary income tax rate of 33%. Therefore, Perry owes (33% * $4,000) = $1,320 in taxes on this gain.
Adding these amounts together gives a total tax liability of $7,320, which is consistent with answer choice B.

Perry Is in the 33% Tax Bracket