The Tax Questions Blog

Question: The Talley Corporation has a Taxable Income of $365,000 from operations after all operating costs but before (?

The Talley Corporation has a taxable income of $365,000 from operations after all operating costs but before (1) interest charges of $50,000, (2) dividends received of $15,000, (3) dividends paid of $25,000 and (4) income taxes. What are the firms income tax liability and its after tax income? What are the company’s marginal and average tax rates on taxable income?

Please help!!

Answer: Here is the calculation for the problem below:

Income $365,000
Less Interest deduction (50,000)
Plus: Dividends received 4,500
Taxable income $319,500
70% of dividends received are excluded from taxes = $15,000(1 – 0.70) = $4,500.

Tax = $22,250 + ($319,500 – $100,000)*0.39
Tax= $22,250 + $85,605 = $107,855.

After-tax income:
Taxable income $319,500
Taxes (107,855)
Plus Non-Taxable Dividends received 10,500
Net income $222,145
Non-taxable dividends: $15,000 x 0.7 = $10,500.

Marginal tax rate is 39 percent
Average tax rate is $107,855/$319,500 = 33.76%.

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Question: Claimed eic when not my turn due 2 agreement with ex wife, now she wants to turn me in for fraud?

we share placement and custody WITH current mediation agreement, has us splitting time 50/50

in wisconsin, according to agreement we take turns with claiming as dependentWe had verbal agreement to allow me Child Earned income credit, and got along peacefully most of 2009. Agreement was due to many favors and loans i provided. I filed my taxes a week ago and already got my money. Now she is mad and threatening to turn me in for EIC or tax fraud!!!!

I am aware we have no written agreement, and if taken to court for EIC issue, i would lose.

I have no previous tax issues, and this was just a verbal agreement gone bad due to my new relationship…

This was absolutely no flagrant violation, except for my stupidity not to get it in writing. what will happen? Will she have to tak me to court or does IRS pay her too, and make m pay them back….

please hlp.

Answer: If you filed for a credit that you were not eligible to receive, you will have to pay back any money you received as a result. The IRS will not mediate in disputes such as these, but they will come after you for fraud if you don’t have your ducks in a row. And in the future, get these agreements in writing and give them to your attorney. That way, it won’t come back to bite you.

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Question: will paying your mortgage on time help your credit if you have a car repo?

Long story short, cosigned for a car loan in 2003 for an ex boyfriend.. He made payments normally up until October of 2007. Currently he hasn’t paid April, May, and June’s payment. He had 2 payments in May scheduled and only one went through. I haven’t seen or heard from him since Sept 2007. I have consumer statements on file w/ the credit bureau and was blessed w/ getting a nice house w/ 100% financing an a good interest rate. Nobody seems to know where this guy is and his own mother that lives out of town won’t return my calls.

Answer: Paying timely on the mtg wont help your credit damage done by a repo. Not paying timely and a repo spells doom. As the co signer you have been requested to do what you agreed to do. You have guaranteed the car loan would be paid by you should your less worthy friend default. Apparently you arent going to pay either. If you have a car loan of your own and continue to pay timely payments that will help heal your credit better than the mtg. Remeber, a co signor is a guarantor, not just a contact for the lender. Consumer statements are worthless. You seem like a straight up kind of person. The right thing to do is to pay the payments and then collect from the A– Hole when you can. His Mom is no better than him or she would have co signed. The apple doesn’t fall far from the tree.

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Question: I need help with these 2 financial questions?

I need help with these two problems. Here’s the info:
Net Sales$318,400
Less-Cost of Goods Sold 229,800
Less:Depreciation 9,100
Earnings before interest and taxes 79,500
Less:Interest paid 7200
Taxable Income $72,300
Less:Taxes 25,300
Net Income $47,000
Cash 2006-$18,700 2007-$24,200
Accounts Receivable 2006-$16,400 2007-$14,900
Inventory 2006-$154,200 2007-$128,500
Sub-total 2006-$189,300 2007-$167,600
Net fixed assets 2006-$84,500 2007-$121,800
Total 2006-$273,800 2007-$289,400
Accounts payable 2006-$88,000 2007-$67,900
Long-term debt 2006-$94,800 2007-$89,600
*Common Stock 2006-$57,500 2007-$60,000
Retained earnings 2006-$33,500 $2007-$71,900
Total 2006-$273,800 2007-$289,400
*The Par Value of the common stock is $1 per share

1-What is the amount of the net cash from investment activity for 2007?
A)$46,400
B)$41,800
C)$52,400
D)$52,000
E)$37,300

2-What is the amount of dividends paid in 2007?
A)$2,357
B)$217
C)$349
D)$0
E)$2,013

Answer: 1 c 2 e!!!

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