Chuck, a single taxpayer, earns $75,000 in taxable income and $30,700 in interes

Question

Chuck, a single taxpayer, earns $75,000 in taxable income and $30,700 in interest from an investment in City of Heflin bonds. (Use the U.S tax rate schedule.) Required a. How much federal tax will he owe? b. What is his average tax rate? c. What is his effective tax rate? d. What is his current marginal tax rate? Complete this question by entering your answers in the tabs below. Req A Req B Req C Req D How much federal tax will he owe? (Do not round intermediate calculations. Round "Federal tax" to 2 decimal places.) Federal tax Req A Req B

Explanation / Answer

As Per Tax Rate of 2017 :-

1) Federal Income Tax = $5226.25 + 25%*($75000 - $37950)

= $5226.25 + 25%*$37050

= $5226.25 + $9262.5

= $14488.75

2) Average Tax Rate :-

= (Total Tax / Taxable Income)*100

= ($14488.75 / $75000)*100

= 19.32%

3) Effective Tax Rate :-

= Total Tax / Total Income

= $14488.75 / ($75000+$30700)

= $14488.75 / $105700

= 13.71%

4) Marginal Tax Rate is 25%

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.