Leonardo, who is married but files separately, earns $61,000 of taxable income. He also has $15,600 in city of Tulsa bonds. His wife, Theresa, earns $50,600 of taxable income. If Leonardo and his wife are married filing jointly in 2026, what is Leonardo and Theresa’s effective tax rate for 2026? (Use tax rate schedule (opens in a new tab).) Note: Round your final answer to two decimal places.

Sadie received $52,500 of compensation from her employer (including $2,000 of qualifying overtime compensation eligible for the qualified overtime compensation deduction) and she received $570 of interest from a corporate bond. What is the amount of Sadie’s gross income from these items?

Michelle is an active participant in the rental condominium property she owns. During the year, the property generates a ($24,500) loss; however, Michelle has sufficient tax basis and at-risk amounts to absorb the loss. If Michelle has $132,000 of salary, $11,900 of long-term capital gains, $4,900 of dividends, and no additional sources of income or deductions, how much loss can Michelle deduct?

Ashburn reported a $105,050 net §1231 gain in Year 6. Assuming Ashburn reported $59,000 of nonrecaptured §1231 losses during Years 1 to 5, what amount of Ashburn’s net §1231 gain for Year 6, if any, is treated as ordinary income?

Jamie is single. In 2026, she reported $100,600 of taxable income, including a long-term capital gain of $6,200. What is her gross tax liability? (Use the tax rate schedules (opens in a new tab), long-term capital gains tax brackets (opens in a new tab).) Note: Round your answer to the nearest whole dollar amount.

Which of the following decreases the benefits of accelerating deductions?

Jamison’s gross tax liability is $8,950. Jamison had $2,410 of available credits and he had $5,450 of taxes withheld by his employer. What are Jamison’s taxes due (or taxes refunded) with his tax return?

Sabina recently was sickened by eating spoiled peanut butter. She successfully sued the manufacturer for her medical bills ($3,940), her emotional distress ($8,150—she now fears peanut butter), and punitive damages ($58,750). What amount must Sabina include in her gross income?

Nontax factor(s) investors should consider when choosing among investments include:

Manny, a single taxpayer, earns $70,000 per year in taxable income and an additional $12,500 per year in city of Boston bonds. What is Manny’s current marginal tax rate for 2026? (Use tax rate schedule (opens in a new tab).)