Question

Maureen Smith is a single individual. She claims one exemption of $4,000 for herself and claims a standard deduction of $6,300. Her salary for the year was $172,850. Assume the following tax table is applicable. Single Individuals You Pay This Plus This Percentage Average Tax If Your Taxable Amount on the on the Excess over the Rate at Income Is Base of the Bracket Base Top of Bracket 10.0% 10.0% 13.8 15.0 25.0 20.4 Up to $9,225 $9.225-$37,450 $37,450 $90,750 $90,750-$189,300 $189,300-$411,500 $411,500-5413,200 Over $413,200 $0.00 922.50 5,156.25 18,481.25 46,075.25 119,401.25 119,996.25 24.3 29.0 28.0 33.0 35.0 39.6 What is her average tax rate? 23.03 21.84% 26.35% 18.52 23.74%

Answer 1

Calculating the Total Taxable Income of Maureen Smth

Total Taxable Income after Exemption & Standard Deduction = $ 172850-$4000-$6300

Total Taxable Income = $162550

Calculating the Total Tax of Maureen Smth:

Tax = 18481.25 + (162550-90750)*28%

= 18481.25 + 20104

= $ 38585.25

Total tax payable by Maureen Smith on Taxable Income is $ 38585.25

Calculating Average Tax Rate:

Average Tax Rate = Total Tax/Total Taxable Income

= 38585.25/162550

= 23.74%

So, Average Tax Rate is 23.74%

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