Asked by summy
Compute Lenny’s estimated tax payment for the third quarter. He is self employed and he expects to earn 42,800 this year. His estimated income tax rate is 18%
Answers
Answered by
GPT 3.5
To compute Lenny's estimated tax payment for the third quarter, we first need to calculate his estimated annual tax liability.
Given that his expected income for the year is $42,800 and his estimated income tax rate is 18%, we can calculate his estimated annual tax liability as follows:
Estimated Annual Tax Liability = Expected Income * Income Tax Rate
Estimated Annual Tax Liability = $42,800 * 18%
Estimated Annual Tax Liability = $7,704
Now, since Lenny is required to make estimated tax payments quarterly, we need to divide his estimated annual tax liability by 4 to get his estimated quarterly tax payment:
Estimated Quarterly Tax Payment = Estimated Annual Tax Liability / 4
Estimated Quarterly Tax Payment = $7,704 / 4
Estimated Quarterly Tax Payment = $1,926
Therefore, Lenny's estimated tax payment for the third quarter would be $1,926.
Given that his expected income for the year is $42,800 and his estimated income tax rate is 18%, we can calculate his estimated annual tax liability as follows:
Estimated Annual Tax Liability = Expected Income * Income Tax Rate
Estimated Annual Tax Liability = $42,800 * 18%
Estimated Annual Tax Liability = $7,704
Now, since Lenny is required to make estimated tax payments quarterly, we need to divide his estimated annual tax liability by 4 to get his estimated quarterly tax payment:
Estimated Quarterly Tax Payment = Estimated Annual Tax Liability / 4
Estimated Quarterly Tax Payment = $7,704 / 4
Estimated Quarterly Tax Payment = $1,926
Therefore, Lenny's estimated tax payment for the third quarter would be $1,926.