Question

Chuck, a single taxpayer, earns $80,750 in taxable income and $30,750 in interest from an investment in city of heflin bonds. (use the u.s. tax rate schedule.) (do not round intermediate calculations. round your answers to 2 decimal places.)

Answer 1

Step-by-step explanation:

Let’s use the tax rate schedule for 2019

Since Chuck status is single and earned $80,750.

He would pay 10 percent on the first $9,700 of his earnings ($970);

Then 12 percent on the other earnings from $9,701 to $39,475 ($3,573); and then 22 percent on the remaining income, up to $80,750 ($9,081).

Chuck total tax bill would be $13,624. Divide that by adding his earnings of $80,750 and interest of $30,750 and you get an effective tax rate of 12.22 percent.