Henry, a freelance driver, finds customers using various platforms such as Uber and Grubhub. He is single and has no other sources of income. In 2019, Henry's qualified business income from driving totals $61,200. Assume Henry takes the standard deduction of $12,200.Click here to access the 2019 individual tax rate schedule to use for this problem. Assume the QBI amount is net of the self-employment tax deduction. Compute Henry's QBI deduction and his Federal income tax liability. QBI deduction: $Tax liability (round to the nearest dollar): $

Henry's QBI is $9,760

Tax liability = $4,510

Explanation:

The question is to determine Henry's QBI deductions as well as his Federal Income Tax Liability

First we determine his MTI = His net income - His standard deduction

= $61,200 - $12,200

= $49,000

QBI(Qualified Busines Income) Deduction

This will represent the lesser of the following

First = 20% of his Net Income = 0.2 x $61,200 = $12,240

Second= 20% of his MTI = 0.2 x $48,800= $9,800

Henry's QBI is $9,800

Tax Liability Computation

Based on the tax rate for individuals in 2019,

His income tax is as follows

= $970 + (12% x ($49,000-$9,800)- $9,700)

= $970 + $3,540

= $4,510

both are integral parts of a corporate balance sheet. the cash flow statement, or statement of cash flows, measures the sources of a company's cash and its uses of cash over a specific time period. the income statement measures a company's financial performance, such as revenues, expenses, profits or losses over a specific time period (in fact, it's sometimes called a statement of financial performance).

a cash flow statement shows exactly how much money a company has received and how much it has spent, traditionally over a period of one month. it captures the current operating results and changes on the balance sheet, such as increases or decreases in accounts receivable or accounts payable, and does not include noncash accounting items such as depreciation and amortization. the cash flow generally comes from revenue received as a result of business activity, but it may be augmented by funds available as a result of credit. a cash flow statement is used to determine the short-term viability and liquidity of a company, specifically how well it is positioned to pay its bills and vendors.