Question

You put $2,000 into a tax-deferred retirement account this year. your marginal tax rate is 15%. how much did you save on this year's tax bill?

a.$150
b.$300
c.$1,700
d.$2,000

Answer 1

i want to say 150 which is answer A

Answer 2

Usually we pay some tax to the government on the salary or earning.

Given that money deposited into tax-deferred retirement account this year = $2000

Given that marginal tax rate = 15 %

Now we have to find the how much did you save on this year's tax bill.

tax on deposited money will be = 15% of 2000

= 0.15* 2000 = 300

So tax paid = $300

Money left after paying tax = $2000 - $300 = $1700

Hence money saved this year’s tax bill is $1700.