4. Taxes paid for a given income levelAntonio is getting ready to do his taxes. He is single and lives in Chicago. Antonio earned $110,000 in 2020. He reviews the following table, whichshows the IRS tax rates for a single taxpayer in 2020.On Annual Taxable Income...Up to $9,875From $9,875 to $40,125From $40,125 to $85,525From $85,525 to $163,300From $163,300 to $207,500From $207,500 to $518,400The Tax Rate Is...(Percent)1012Antonio calculates that he owes approximately17202330Based on the IRS table, Antonio calculates that his marginal tax rate iswhen his annual income is $110,000.▼ in income taxes for 2020.Antonio then calculates that his average tax rate is approximatelyfor 2020.▼, based on the annual income level and the amount of taxes he owesAfter figuring out what he owes in taxes in 2020, Antonio decides to ask an accountant for tax advice. The accountant claims that he has found a legalway to shelter $3,000 of taxable income from the federal government.The maximum amount that Antonio is willing to pay to learn this strategy and reduce his taxable income by $3,000 is(Hint: Shelteringsome income means finding a legal way to avoid being charged income tax on that income. For example, someone who has $50,000 in income andshelters $10,000 pays income tax on only $40,000.)

Marginal Tax Rate: The marginal tax rate is the rate at which an additional dollar of income is…

4. Taxes paid for a given income level Antonio is getting ready to do his taxes. He is single and lives in Chicago. Antonio earned $110,000 in 2020. He reviews the following table, which shows the IRS tax rates for a single taxpayer in 2020.- On Annual Taxable Income... Up to $9,875 From $9,875 to $40,125 From $40,125 to $85,525 From $85,525 to $163,300 From $163,300 to $207,500 From $207,500 to $518,400 The Tax Rate Is... (Percent) 10 12 17 20 23 30

4. Taxes paid for a given income level Antonio is getting ready to do his taxes. He is single and lives in Chicago. Antonio earned $110,000 in 2020. He reviews the following table, which shows the IRS tax rates for a single taxpayer in 2020.- On Annual Taxable Income... Up to $9,875 From $9,875 to $40,125 From $40,125 to $85,525 From $85,525 to $163,300 From $163,300 to $207,500 From $207,500 to $518,400 The Tax Rate Is... (Percent) 10 12 17 20 23 30

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Design Of The Tax System

Section: Chapter Questions

Problem 2PA

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2. Taxes paid for a given income level Poornima is getting ready to do her taxes. She is single and lives in Detroit. Poornima earned $50,000 in taxable income in 2015. She reviews the following table, which shows the IRS tax rates for a single taxpayer in 2015. On Annual Taxable Income... Up to $9,225 From $9,225 to $37,450 From $37,450 to $90,750 From $90,750 to $189,300 From $189,300 to $411,500 From $411,500 to $413,200 Over $413,200 The Tax Rate Is... (Percent) 10.0 15.0 Poornima calculates that she owes 25.0 28.0 33.0 35.0 39.6 Based on the IRS table, Poornima calculates that her marginal tax rate is Poornima then calculates that her average tax rate is when her annual taxable income is $50,000. in income taxes for 2015. , based on the annual income level and the amount of taxes she owes for 2015. After figuring out what she owes in taxes in 2015, Poornima decides to ask an accountant for tax advice. The accountant claims that he has found legal way to shelter $4,000 of taxable…
4. Taxes paid for a given income level Caroline is getting ready to do her taxes. She is single and lives in San Francisco. Caroline earned $250,000 in 2011. She reviews the following table, which shows the IRS tax rates for a single taxpayer in 2011. On Annual Taxable Income... Up to $8,500 From $8,500 to $34,500 From $34,500 to $83,600 From $83,600 to $174,400 From $174,400 to $379,150 Over $379,150 The Tax Rate Is... (Percent) 10 15 25 28 33 35 Based on the IRS table, Caroline calculates that her marginal tax rate is Caroline calculates that she owes in income taxes for 2011. Caroline then calculates that her average tax rate is I when her annual income is $250,000. based on the annual income level and the amount of taxes she owes for 2011. After figuring out what she owes in taxes in 2011, Caroline decides to ask an accountant for tax advice. The accountant claims that he has found a legal way to shelter $1,000 of taxable income from the federal government. The maximum amount that…
.How are the income taxes determined?
30. Steve earned $50 in income last year and the current tax brackets are 20% for the first $10 of income, 30% for the next $10 of income, and 50% for all additional income. In addition there is a $20 deduction that exempts that amount of income from taxation. Steve’s total taxes are _____.
12. Study Questions and Problems #12 Consider the first three columns of the following table, which outline a hypothetical Negative Income Tax plan. Complete the last column of the table. Family Income Negative Tax Positive Tax Total After-Tax Income $0 $10,000 $0 S 5,000 $7,500 0 S 10,000 $5,000 0 S 15,000 $2,500 0 S 20,000 0 0 S 25,000 0 -$2,500 S 30,000 -$5,000 S 35,000 -$7,500 S
Table 12-10 On Taxable Income ... The Tax Rate is ... Up to $8,375 10% From $8,375 to $34,000 15 From $34,000 to $82,400 25 From $82,400 to $171,850 28 From $171,850 to $373,650 33 Over $373,650 35 Refer to Table 12-10. If Willie has $170,000 in taxable income, his tax liability will be a. $16,781. b. $41,309. c. $41,827. d. $47,600.
Table 12-3 The following table presents the total tax liability for an unmarried taxpayer under four different tax schedules for the income levels shown. Income (Dollars) S 50,000 20,000 10,000 30,000 100,000 30,000 200,000 80,000 40,000 Refer to Table 12-3. For an individual with $200,000 in taxable income, which tax schedule has the lowest average tax rate? Oa. Tax Schedule D O b. Tax Schedule B O c. Tax Schedule C O d. Tax Schedule A с % JE JE 5 6 JUL G Ін B Tax Schedule A Tax Schedule B Tax Schedule C Tax Schedule D 17,500 15,000 25,000 30,000 30,000 60,000 & 7 IN FB U Amount of Tax Due (Dollars) * 8 Ĉ UL JO K ( 9 O *- ) O F11 P + F12 11 : M JUJU Question 30 of 50 PrtSc [ Insert LO
2. Explain the Structure of the Individual Income Tax in the United States. Give Example.
Based on the following data: Taxable income ($) Total tax ($) 1500 5 2500 110 3000 200 4500 400 5000 600 6000 900 Please answer the next questions. 1. What kind of tax is illustrated, i.e, structural, perverse, proportional or progressive. Explain. 2. If your taxable income is $5000, what is your average tax rate? 3. If your taxable income increases from $5000 to $6000, what is your marginal tax rate?