Final answer:
The effective tax rate for a taxable income of $95,600 is approximately 21.00%.
Step-by-step explanation:
To determine the effective tax rate for a taxable income of $95,600, we must first calculate the total tax paid and then divide that by the taxable income. The tax brackets indicate that taxes are progressive, so we apply each marginal tax rate to the respective portion of the taxable income. Here's the step-by-step calculation:
- $10,275 taxed at 10% = $1,027.50
- $41,175 - $10,276 = $30,899, taxed at 12% = $3,707.88
- $89,075 - $41,176 = $47,899, taxed at 22% = $10,537.78
- $95,600 - $89,076 = $6,524, taxed at 24% = $1,565.76
Add these amounts together for the total tax:
$1,027.50 + $3,707.88 + $10,537.78 + $1,565.76 = $16,838.92
To find the effective tax rate, we divide the total tax by the income and multiply by 100:
Effective Tax Rate = ($16,838.92 / $95,600) × 100 = 17.61%
The effective tax rate for a taxable income of $95,600 is calculated by applying the marginal tax rates to the respective income brackets and summing the total tax. Divide this by the taxable income and multiply by 100 to get the effective tax rate, which is 17.61%.
Therefore, the effective tax rate for a taxable income of $95,600 is 17.61%, rounded to the nearest hundredth.