Final answer:
The additional $2,000 tax deduction would reduce Jerome's taxable income to $48,000, and assuming his marginal tax rate is 15.90%, it would save him $318 in taxes, resulting in a new federal tax payable of $7,632.
Step-by-step explanation:
Impact of an Additional Tax Deduction on Taxable Income:
The question is about how a tax deduction would affect Jerome's taxes. Since Jerome has a taxable income of $50,000 and a federal tax payable of $7,950 with an average tax rate of 15.90%, the additional $2,000 tax deduction would reduce his taxable income to $48,000. Tax deductions reduce the amount of income subject to tax, which in turn lowers the overall tax liability. However, the actual impact of the tax deduction would depend on Jerome's marginal tax rate, which is the rate applied to his last dollar of income.
If we assume that Jerome's marginal tax rate is the same as his average tax rate due to a progressive tax system, then his federal tax payable would decrease by the deduction amount multiplied by his marginal tax rate. Therefore, the additional $2,000 tax deduction at a 15.90% marginal tax rate would result in a tax savings of $318 ($2,000 * 0.1590). The new federal tax payable would be $7,950 - $318 = $7,632.
It's important to note that the marginal tax rate can differ from the average tax rate. The average tax rate is the total tax paid divided by the taxable income, whereas the marginal tax rate is the rate paid on the last dollar of income. This understanding is crucial when calculating potential tax savings from deductions.