Final answer:
Randy's tax situation involves calculating his federal and state tax refunds based on the withheld amounts and his actual tax liability. Marginal tax rates, which range for a single taxpayer from 10% to 35%, are used to determine taxable liability. Since his withheld taxes exceeded his liability, Randy received refunds.
Step-by-step explanation:
The question relates to the computation of a taxpayer's refund after filing federal and state tax returns. Randy, who is a single taxpayer, received a salary of $30,000, had $7,000 withheld for federal taxes and $2,500 for state taxes. After filing his 2018 federal tax return, he received a $400 federal refund and a $50 state refund in 2019. Marginal tax rates play a role in determining the amount of tax due and how much might be refunded. According to the provided information, marginal tax rates for a single taxpayer range from 10% to 35%, depending on income.
The calculation of refunds is based on the difference between the taxes withheld and the actual tax liability. The federal and state governments may provide refunds if the withheld amounts exceed the taxpayer's liability calculated at the end of the tax year. Taxpayers can use tax tables to find the exact tax based on their taxable income. For example, with a taxable income of $20,000, one would refer to the tax table to compute the owed amount and compare it with what has been withheld.