Question

2007 Federal Income Tax Table

Single:
Over But not over The tax is
$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
Tim Tradesman had a taxable income of $82,500. He figured his tax from the table above.

1. Find his earned income level.

2. Enter the base amount. = $
17,211.00

3. Find the amount over $
= $

4. Multiply line 3 by
% = $

5. Add Lines 2 and 4 = $

Answer 1

Tim Tradesman's federal income tax is calculated using the 2007 Federal Income Tax Table by identifying that his income falls into the fourth bracket, finding the base amount ($15,699), calculating the amount over the lower limit of the bracket ($5,400), and then computing and adding additional tax ($1,512) to the base amount, resulting in a total tax of $17,211.

Step-by-step explanation:

To calculate Tim Tradesman's federal income tax using the 2007 Federal Income Tax Table, we need to follow a multi-step process:

• First, we need to identify Tim's earned income level based on his taxable income of $82,500.
• According to the table, his income level falls into the fourth bracket ($77,100 to $160,850).
• Next, we need to find the base amount of tax for this bracket, which is $15,699.
• Then, we calculate the amount over $77,100 by subtracting $77,100 from Tim's taxable income, yielding $82,500 - $77,100 = $5,400.
• After that, we multipy this excess amount by the percentage rate for this bracket, 28%, to get additional tax: 0.28 × $5,400 = $1,512.
• Finally, to get the total tax, we add the base amount to the calculated additional tax: $15,699 + $1,512 = $17,211.

This results in a total federal income tax of $17,211 for Tim Tradesman.