Final answer:
The federal income tax withholding rate for non-wage payments without a TIN is 24%. The U.S. has a progressive tax system with varying rates based on income.
Step-by-step explanation:
The amount of federal income tax that must be withheld from non-wage payments to an individual who has failed to provide a taxpayer identification number (TIN) is 24%. This backup withholding rate is applied to certain payments including interest, dividends, and other types of payments reported on Form 1099.
Prior to 2018, the backup withholding rate was 28%, but due to changes in tax law, the current rate is now 24%. The United States tax system is a progressive tax system, meaning that as a household's income increases, the tax rates also increase accordingly. There are different tax brackets that apply, with the marginal tax rates for a single taxpayer ranging from 10% to 37% depending on the income bracket they fall into.