Question

Aiden has a gross income of $63,000 and takes the standard deduction. Their total taxes due are $6,847.50.

a) What is their taxable income?
b) What is their marginal tax rate?
c) What is their effective tax rate? Round to the nearest hundredth of a percent.

Answer 1

a)56,152.5

b)40.2%

c)10.87%

Explanation:

a) $63,000-$6,847.5=$56,152.5

b) marginal tax rate of a $63,000 income is 40.2%

c) 6,847.5 is 10.869047619% of 63,000 but it has to be to nearest hundreth so it is 10.87% because the thousandths place is a 9 so you round up to 10.87%.