Question

Refer to the individual rate schedules in Appendix C. a. What are the tax liability, the marginal tax rate, and the average tax rate for a married couple filing jointly with $67,900 taxable income? b. What are the tax liability, the marginal tax rate, and the average tax rate for a single individual with $191,800 taxable income? c. What are the tax liability, the marginal tax rate, and the average tax rate for a head of household with $462,300 taxable income? Complete this question by entering your answers in the tabs below. Required A Required B Required C What are the tax liability, the marginal tax rate, and the average tax rate for a married couple filing jointly with $67,900 taxable income? (Round final "Tax liability to the nearest whole dollar and "Average tax rate" to 2 decimal places.) Tax liability Marginal tax rate Average tax rate Required A Required B >

Answer 1

a.Taxable Income = $67,900

Tax liability is as follows:

1940+ (67900-19400)*12%

= $7,760

Marginal tax rate is the rate applicable on one additional dollar of income

i.e. 12%

Average tax rate = Total tax/Total income

= 7760/67900

= 11.43%

b.Taxable income = $191,800

Tax = 32,748.50 + (191800-160725)*32%

= $42,692.5

Marginal tax rate = 32%

Average tax rate = 22.26%

c.Taxable Income = $462,300

Tax = 45,210 + (462300-204100)*35%

= $135,580

Marginal tax rate = 35%

Average tax rate = 29.33%