Question

due to the same law, persons earning $500,000 per year had lower taxes removed from their paychecks on the first $106,800 they earned, saving them 2% of this portion of their salary. The same persons also received $14,250 more on their federal tax return. Fill in the blanks to complete the statement below. A person earning $500,000 a year received $______ more or______ % more of their income. Round to the nearest dollar and to the nearest tenth of a percent.

Answer 1

Given that the person earning $500,000 had a lower tax removed from them on the first $106,800 they earned, the amount saved if this portion was:
2/100*106,800
=$2136
amount received on federal tax return was $14,250

Total amount saved from taxes was:
14250+2136
=$16,386
this is equivalent to 16,386/500000=0.032772~3.28%
hence the answer is:
A person earning $500,000 a year received $16,386 more or 3.28% more of their income.