Sallie earned $85,000 and paid $5,950 of income tax; Theodore earned $33,000 and

Question

Sallie earned $85,000 and paid $5,950 of income tax; Theodore earned $33,000 and paid $2,310 of income tax. The tax rate structure they are subject to is:

Multiple Choice

Recessive.

Progressive.

Regressive.

Proportional.

.

.

The tax liability for a single individual with taxable income of $68,312 is:

Multiple Choice

$9,316.

$11,334.

$12,817.

$12,820.

.

.

Federal tax legislation generally originates in which body?

Multiple Choice

Senate Finance Committee.

Internal Revenue Service.

Supreme Court.

House Ways and Means Committee.

Explanation / Answer

1 Average tax rate Sallie = 5950/85000= 7% Average tax rate Theodore = 2310/33000= 7% The tax rate structure is Proportional. 2 Tax liability = 5226+(68312-37950)*0.25= $12817 3 Federal tax legislation generally originates in House Ways and Means Committee.

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