Question

Mary Hernandez earned $43,000 in taxable income. She figured her tax from the single taxpayer table above.

$0 $7,825 10% of the amount over $0

$7,825 $31,850 $788 + 15% of the amount over $7,825

$31,850 $77,100 $4,386 + 25% of the amount over $31,850

$77,100 $160,850 $15,699 + 28% of the amount over $77,100

$160,850 $349,700 $39,149 + 33% of the amount over $160,850

$349,700 And Over $101,469 + 35% of the amount over $349,700





1. Find her earned income level.


2. Entered the base amount. = $


3. Found the amount over $ = $


4. Multiplied line 3 by 25% = $


5. Added Lines 2 and 4

Answer 1

Taxes = $7,135.50

Explanation:

1. Find her earned income level.

From the taxpayer table, Mary's income falls within the interval of $31,850 to $77,100

2. Enter the base amount.

For that interval, the base amount is $4,386

3. Find the amount over $31,850

Since she earns $43,000, the amount over the lower bound ($31,850) is:

$43,000 - $31,850 = $11,150

4. Multiply line 3 by 25% = $

Her tax rate for her income is 25%, multiply the value found in step by 0.25

$11,150 x 0.25 = $2,787.50

5. Add Lines 2 and 4

Finally, her total taxes are obtained by adding the base amount (step 2) to the amount found in step 4:

Taxes = $4,386 + $2,787.50= $7,135.50