Question

zuri has an annual income of $42,200 a year and plans to take the standard deduction. suppose the standard deduction is $12,200, and her marginal tax rate is 12%. how much will she have to pay in federal income tax?

Answer 1

Zuri will have to pay $3,600 in federal income tax by applying her 12% marginal tax rate to her taxable income of $30,000 (her income minus the standard deduction).

Step-by-step explanation:

Zuri will have to pay $3,600 in federal income tax. First, we calculate her taxable income by subtracting the standard deduction from her annual income, which is $42,200 - $12,200 = $30,000. Then, we apply her marginal tax rate of 12% to the taxable income to determine the tax amount she owes: 0.12 x $30,000 = $3,600.

An important concept in taxation is the marginal tax rate, which represents the percentage of tax applied to your income for each tax bracket in which you qualify. In the given question, Zuri is within the 12% tax bracket, which means that income above her standard deduction and up to a certain threshold (which varies from year to year) will be taxed at 12%. Understanding one's marginal tax rate is crucial for effective financial planning, as it influences the amount of tax owed and can affect decisions regarding deductions and credits.