(D) $1,024.33
Chapter8: Taxation Of Individuals
Section: Chapter Questions
Problem 37P
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Question
Vlad has an annual salary of $90,000. He contributes 35% of his pre-tax income to his mortgage and 401(k), and he pays $400 per month for car and health insurance (pre-tax, deducted after mortgage and 401(k)). All taxes are calculated based on Casey’s adjusted gross income (pay remaining after mortgage, 401(k), and insurance payments). He must pay: 5% tax on the first $8,000 in income, 20% tax on any income between $8,001 and $40,000, 30% tax on income between $40,001 and $100,000, and a 6% tax on his total adjusted gross income. What is Vlad’s approximate weekly take-home pay after all deductions have been made?
(A) $428.50
(B) $632.11
(C) $760.92
(D) $1,024.33
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