Final answer:
Connor is taxed at the 32% rate on his $130,000 taxable income, and for his capital gains, the short-term gain is taxed at this rate while the long-term gain is likely taxed at a 15% rate. None of the provided answer choices are correct since they either use the wrong percentage for the long-term gains or incorrectly combine the gains. Taxes for his short-term gains would be 32% of $4,000, and long-term gains would likely be at 15% of $13,000.
Step-by-step explanation:
Connor is in the 32% tax bracket, and his taxable income is $130,000. He realized a long-term gain from the sale of a stock investment for $13,000 and a short-term gain for $4,000. For individuals, long-term capital gains are typically taxed at a lower rate than their ordinary income tax rate, depending on their taxable income. For 2019, long-term capital gains could be taxed at 0%, 15%, or 20% for most taxpayers. The short-term gains would be taxed at Connor's regular income tax rate because they are treated as ordinary income. Given Connor's tax bracket, the short-term gains of $4,000 would be taxed at 32%. The long-term gains taxation would require knowing Connor's filing status and exact taxable income with these gains included, but since they're not over $434,550 for a single filer in 2019, they would likely be subject to a 15% tax rate, not the 28% option provided. Therefore, no provided answer option is correct. The tax on the short-term gain would be 32% of $4,000 and the tax on the long-term gain would likely be 15% of $13,000, assuming Connor isn't subject to higher rates applying to higher income levels.