Question

Mia and Michael have adjusted gross incomes of $47,600 and $33,600, respectively. Assume that each person takes one exemption and the standard deduction. Answer parts (a) through (c) below. Married Filing Tax Rate Single Jointly 10% up to $8,925 up to $17,850 15% up to $36,250 up to $72.500 25% up to $87,850 up to $146,400 28% up to $183,250 up to $223.050 Standard $6100 $12.200 Deduction Exemptions $3900 3900 (per person) a. Calculate the tax owed by the couple if they delay their marriage until next year so they can each file a tax return at the single tax rate this year. The couple owes $ (Simplify your answer. Round to the nearest dollar as needed.) b. Calculate the tax owed by the couple if they marry before the end of the year and file a joint return. The couple owes $ (Simplify your answer. Round to the nearest dollar as needed.) c. Does the couple face a "marriage penalty" if they marry before the end of the year? O Yes No

Answer 1

a. Tax owed if they delay marriage = 5328.75+3093.75 = 8422.50

b. Tax owed if filing jointly = 8287.50

c. No

Workings:

Mia
Adjusted Gross Income	47600
Standard deduction	6100
Exemptions	3900
Taxable income	37600
Total taxes owed	5328.75
Upto 8925	8925*10%	892.5
Upto 36250	(36250-8925)*15%	4098.75
Upto 87850	(37600-36250) *25%	337.5
Total taxes owed		5328.75

Michael
Adjusted Gross Income	33600
Standard deduction	6100
Exemptions	3900
Taxable income	23600
Total taxes owed	3093.75
Upto 8925	8925*10%	892.5
Upto 36250	(23600-8925)*15%	2201.25
Total taxes owed		3093.75

Filing jointly
Adjusted Gross Income	81200
Standard deduction	12200
Exemptions	7800
Taxable income	61200
Upto 17850	17850*10%	1785
Upto 72500	(61200-17850)*15%	6502.5
Total taxes owed		8287.5