Rick, who is single, has been offered a position as a city landscape consultant. The position pays $110,000 in cash wages. Assume Rick files single and is entitled to one personal exemption. Rick deducts the standard deduction instead of itemized deductions. (use the tax rate schedules.)
Suppose Rick receives a competing job offer of $105,000 in cash compensation and nontaxable (excluded) benefits worth $4,350. What is the amount of Rick’s after-tax compensation and income tax liability for the competing offer?
| (1) | Gross income | $105,000 | ||
| (2) | For AGI deductions | 0 | ||
| (3) | Adjusted gross income | $105,000 | ||
| (4) | Standard deduction | (6,300) | ||
| (5) | Personal and dependency exemptions | (4,000) | ||
| (6) | Taxable income | $94,700 | ||
| (7) | Income tax liability | |||
| After-tax compensation | ||||
