Question

Chuck, a single taxpayer, earns $79,000 in taxable income and $10,000 in interest from an investment in City of Heflin bonds. (Use the U.S. tax rate schedule.)

Income and $19,900 in interest from an investment in City of Heflin bonds. (Use the U.S tax rate schedule.)
Required:
a. How much federal tax will he owe?
b. What is his average tax rate?
c. What is his effective tax rate?
d. What is his current marginal tax rate?
Complete this question by entering your answers in the tabs below Req B Req D Req A Req C What is his average tax rate? (Do not round intermediate calculations. Round total tax to 2 decimal places.) Average Tax Rate Choose numeratorChoose denominator Total tax Taxable income 8,479.50 14.88% 57,000

Answer 1

Base 98900 79000

tax excess 85525 40125

Excess 13375 38875

% 24% 22%

tax 1 3210 8552.5

tax 2 additional 14605.5 plus 24% of the excess 85.525

4617.5 plus 22% of the excess 40.125

total tax (tax1+tax2) 17815.5__13170

Change in tax

(17.815 - 13.170) / (98,900 - 79,000) =

4.645,5 / 19.900 = 23.34%

Step-by-step explanation:

Base 98900 79000

tax excess 85525 40125

Excess 13375 38875

% 24% 22%

tax 1 3210 8552.5

tax 2 additional 14605.5 4617.5

total tax 17815.5 13170

Change in tax

(17.815 - 13.170) / (98,900 - 79,000) =

4.645,5 / 19.900 = 23.34%