Below is a table with four different scenarios for a taxpayer who opts to sell...
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Accounting
Below is a table with four different scenarios for a taxpayer who opts to sell several different types of stock throughout the year. Assume that all ordinary income for the taxpayer is taxed at a flat tax rate of 22%. In contrast, his long-term capital gains tax rate is 15%. His only income outside the transactions with the stock is $100,000 or ordinary income from his salary.
Scenario 1
Scenario 2
Scenario 3
Scenario 4
ST capital gain
$4,000
$4,000
$4,000
ST capital loss
$7,000
$7,000
$10,000
LT capital gain
$9,000
$9,000
$9,000
LT capital loss
$5,000
$5,000
$5,000
Fill in the blank: The total change in tax due for the taxpayer because of the gains and losses in Scenario 4 is $_______.
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