Question

Mary Matthews made $950 during a biweekly pay period only social security (fully taxable) and federal income taxes attach to her pay. Matthews contributes $100 each biweekly pay to her company's 401k. Determine Matthews take home pay if she is married and claims 2 allowances. (Use Wage Bracket Method) Round your answer to two decimal place.

Answer 1

To calculate Mary Matthews' take home pay, we need to determine the deductions and taxes on her gross pay. Given the information provided, Mary's take home pay is $657.47.

Step-by-step explanation:

To determine Mary Matthews' take home pay, we need to calculate the deductions and taxes on her gross pay. Given that Mary's gross pay is $950 and she contributes $100 each pay period to her company's 401k, her taxable income is $950 - $100 = $850. First, let's calculate the Social Security and Medicare deductions:

Social Security deduction = 6.2% * taxable income = 0.062 * $850 = $52.70

Medicare deduction = 1.45% * taxable income = 0.0145 * $850 = $12.33

Next, we need to calculate the federal income tax. The wage bracket method is used, so we'll refer to the appropriate tax tables. Based on the given information, Mary is married and claims 2 allowances. Let's assume that the federal income tax is 15% of the taxable income:

Federal income tax = 15% * taxable income = 0.15 * $850 = $127.50

Now, let's calculate Mary's take home pay:

Take home pay = gross pay - Social Security deduction - Medicare deduction - federal income tax - 401k contribution

Take home pay = $950 - $52.70 - $12.33 - $127.50 - $100 = $657.47

Therefore, Mary's take home pay is $657.47.

Answer 2

The correct answer to the following question will be "$831".

Step-by-step explanation:

• Mary Matthews is a married woman, however, her gross salary is $950 per two weeks, as well as the compensation amount, is 2. The year 2018 married bi-weekly wage category table would be used to determine the sum to be withheld underneath the framework of wage class.
• The applicable limit for $950 throughout the list is between $945 or $965 as well as $19 seems to be the amount of funding tax must keep for 2 allowances.

So that the compensation would be:

The sum is taken by her to their residence = Gross Salary - Income Tax deferred - Contribution towards 401k

= $950 - $19 - $100

= $831