Question

Suppose your total taxable income this year is $75,000. you are taxed at a rate of 10 percent on the first $25,000, 20 percent on the next $25,000, and 30 percent on the final $25,000. what is your total income tax? $15,000 $2,500 $7,500 $25,000

Answer 1

To calculate the total income tax, you must sum up the tax for each income portion based on the respective rates. In this scenario, the total income tax on a $75,000 income would be $15,000.

Step-by-step explanation:

To calculate the total income tax based on the given brackets:

• Tax on the first $25,000 at 10%: $25,000 x 0.10 = $2,500
• Tax on the next $25,000 at 20%: $25,000 x 0.20 = $5,000
• Tax on the final $25,000 at 30%: $25,000 x 0.30 = $7,500

The total income tax would be the sum of these amounts:

$2,500 + $5,000 + $7,500 = $15,000