Standard deduction for individual 6100 Standard deduction fo

Standard deduction for individual: $6,100

Standard deduction for married couples filing jointly: $12,200

Quantitative Problem: Jenna is a single taxpayer with no dependents so she qualifies for one personal exemption. During 2013, she earned wages of $109,000. She doesn\'t itemize deductions, so she will take the standard deduction and her personal exemption to calculate 2013 taxable income. In addition, during the year she sold common stock that she had owned for five years for a net profit of $6,100. How much does Jenna owe to the IRS for taxes? Round your intermediated and final answers to the nearest cent.
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2013 Individual Tax Rates
Single Individuals
If Your Taxable Income Is	You Pay This Amount on the Base of the Bracket	Plus This Percentage on the Excess over the Base (Marginal Rate)	Average Tax Rate at Top of Bracket
Up to $8,925	$0	10.0%	10.0%
$8,925 - $36,250	892.50	15.0	13.8
$36,250 - $87,850	4,991.25	25.0	20.4
$87,850 - $183,250	17,891.25	28.0	24.3
$183,250 - $398,350	44,603.25	33.0	29.0
$398,350 - $400,000	115,586.25	35.0	29.0
Over $400,000	116,163.75	39.6	39.6

Solution

Computation of taxable income Wages $109,000 Long yerm capital gain $6,100 Less: Standard deduction -6100 Less personal exemption -3900 Taxable income $105,100 Tax Liability Long term capital gain (6100*15%) 915 Tax on remaining income of $99000 (105100-6100) 17891.25+(28%*(99000-87850)) 21013.25 Total tax liability 21928.25 ans rounded off 21928 ans If any doubt please comment