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During 2019, Zach Has Net Income from His Sole Proprietorship

Question 41

Multiple Choice

During 2019, Zach has net income from his sole proprietorship of $35,000.He also earned $106,600 as an employee in 2019.How much self-employment tax must Zach pay?


A) $5,355
B) $4,905
C) $4,945
D) $4,199
 Social Security and Medicare Taxes 20192018 FICA Social Security tax rate 6.2%6.2% SECA Social Security tax rate 12.4%12.4% FICA Medicare tax rate 1.45%1.45% SECA Medicare tax rate 2.9%2.9% Social Security income limit $132,900$128,400 Medicare tax income limit NoneNone Total SECA rate below SS income limit 15.3%15.3% Deductible SECA rate below SS income limit 7.65%7.65%\begin{array}{|l|r|r|}\hline \text { Social Security and Medicare Taxes } & \mathbf{2 0 1 9} & \mathbf{2 0 1 8} \\\hline \text { FICA Social Security tax rate } & 6.2 \% & 6.2 \% \\\hline \text { SECA Social Security tax rate } & 12.4 \% & 12.4 \% \\\hline \text { FICA Medicare tax rate } & 1.45 \% & 1.45 \% \\\hline \text { SECA Medicare tax rate } & 2.9 \% & 2.9 \% \\\hline \text { Social Security income limit } & \$ 132,900 & \$ 128,400 \\\hline \text { Medicare tax income limit } & \mathrm{None} & \mathrm{None} \\\hline \text { Total SECA rate below SS income limit } & 15.3 \% & 15.3 \% \\\hline \text { Deductible SECA rate below SS income limit } & 7.65 \% & 7.65 \% \\\hline\end{array}

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