Bridget, a single taxpayer, sold a building used in her business during the current year. The realized gain on the sale was $135,000. Of this amount, $95,000 is unrecaptured Section 1250 gain. How will Bridget be taxed on this gain assuming her marginal tax rate is 32 percent and her LTCG rate is 15%?

$95,000 will be taxed at 25% and $40,000 will be taxed at 15%

Explanation:

(See attachment below for Long-term capital gains tax rate)

Depending on income and marital status, the long-term capital gains tax rates are 0%, 15% and 20% respectively.

Bridget is single and her realised gain is $135,000

Out of which $95,000 is unrecaptured Section 1250 gain.

The capital gain attracts 15%

(See attachment below)

The capital gain is calculated as

$135,000 - $95,000 = $40,000

The $95,000 will be taxed at 25% under the unrecaptured Section 1250 gain.

1   all nations face the problem of scarcity because there are limited resources and unlimited wants. nations do not have enough factors of production to produce everything that their population wants. entrepreneurial resources initiate businesses to make new goods and services; labor resources produce goods and services.

2 there are four factors of production: natural resources, labor resources, capital resources, and entrepreneurial resources. natural resources are raw materials from nature that are used to produce goods. trees, water, and grains are natural resources. some natural resources, such as wheat and cattle, are renewable

3 wants

things that you do not need to have in order to survive, but would like to have

needs

things that you must have in order to survive

goods

physical products

services

tasks that a business perform for customers

resources

items that people can use to make or obtain what they need or want

determine

to settle or decide by choice of alternatives or possiblities

4 i really dont know

answer; capital structure decision;