Question

Henry made $30,000 in taxable income last year. Supposed the income tax rate is 15% for the first $8000 plus 18% for the amount over $8000. How much must Henry pay in income tax for last year?

Answer 1

Total Taxable Income = $30,000

Tax Brackets >>>

15% for the first $8000

18% on anything over $8000

So,

Let's calculate 15% of 8000

`\begin{gathered} 0.15*8000 \\ =\$1200 \end{gathered}`

Now,

30,000 - 8000 = $22,000

The tax rate is 18% on $22,000

Let's calculate 18% of 22,000

`\begin{gathered} 0.18*22,000 \\ =\$3960 \end{gathered}`

Thus, the total tax is

`\begin{gathered} 1200+3960 \\ =\$5160 \end{gathered}`

Henry must pay an income tax of $5160 for last year.

Answer$5160