Marc, a single taxpayer, earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham bonds. Using the U. S. tax rate schedule for 2019, what is his average tax rate (rounded)

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Business

Kennedi Hall

4 July, 03:02

Marc, a single taxpayer, earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham bonds. Using the U. S. tax rate schedule for 2019, what is his average tax rate (rounded)

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Answers (1)

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Milton Mclean · Answer 1

Average tax rate = 15.0975%

Explanation:

U. S. tax rate schedule for 2019

($39,475 to $84,200) = $4,543 + (22% over $39,475)

Total income = $65,000

Taxable income = $60,000

$5,000 are not include in taxable income.

Computation:

Tax liability ($39,475 to $84,200) = $4,543 + ($60,000 - $39,475) * 22%

Tax liability ($39,475 to $84,200) = $4,543 + $4,515.5

Tax liability ($39,475 to $84,200) = $9,058.5

Average tax rate = $9,058.5 / $60,000

Average tax rate = 0.150975

Average tax rate = 15.0975%