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Warren Anderson's annual salary is $54,500. His personal exemptions total $1,500. The annual tax withheld is: 1.5 percent of the 1st $1,000, 3.0 percent of the next $2,000, 4.5 percent of the next $2,000, and 5.0 percent over $5,000. How much is deducted annually for state income tax?

User Grzkv
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Final answer:

Warren Anderson's annual state income tax is calculated by applying the given tax rates to portions of his income after personal exemptions, resulting in a total annual tax of $2,565.

Step-by-step explanation:

To calculate Warren Anderson's annual state income tax, we need to apply the given tax rates to the respective portions of his income. Firstly, we subtract personal exemptions from his gross salary. His taxable income after personal exemptions is $54,500 - $1,500 = $53,000.

Next, we calculate the tax using the rates provided:1.5% on the first $1,000 = $1,000 * 0.015 = $153.0% on the next $2,000 = $2,000 * 0.03 = $604.5% on the next $2,000 = $2,000 * 0.045 = $90Since the income surpasses $5,000, remaining income = $53,000 - $5,000 = $48,000;5.0% on the remaining $48,000 = $48,000 * 0.05 = $2,400

Summing these amounts gives us the total annual tax deducted:

Annual income tax = $15 + $60 + $90 + $2,400 = $2,565.First, we calculate the tax for the 1st $1,000: 1.5% of $1,000 = $15.Next, we calculate the tax for the next $2,000: 3.0% of $2,000 = $60.Then, we calculate the tax for the next $2,000: 4.5% of $2,000 = $90.Finally, we calculate the tax for the amount over $5,000: 5.0% of ($54,500 - $5,000) = $24,750.Adding up all these tax amounts, we get $15 + $60 + $90 + $24,750 = $24,915. Therefore, the annual tax withheld for state income tax for Warren Anderson is $24,915.

User Duc
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