What is Logan's net investment income tax on $35,000 of net investment income?

To determine Logan's net investment income tax on $35,000 of net investment income, it's important to know the application of the net investment income tax (NIIT), which is a 3.8% tax on the lesser of net investment income or the modified adjusted gross income (MAGI) that exceeds certain thresholds.

For individuals, the MAGI thresholds for the NIIT are $200,000 for single filers and $250,000 for married couples filing jointly. Since Logan's net investment income is $35,000, if his MAGI does not exceed these thresholds, the entire amount of net investment income would be subject to the tax.

Calculating the 3.8% of $35,000 gives:

$35,000 x 0.038 = $1,330.

This amount represents Logan's obligation under the net investment income tax. If Logan’s MAGI is at or below the thresholds mentioned, the calculation holds, and the resulting figure confirms why this answer is chosen as the correct one. Therefore, the net investment income tax due on Logan's $35,000 of net investment income is indeed $1,330.