If 40% is the phase-out rate, what is the marginal tax rate on EITC benefits if earned income is $0.
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Consider a EITC program that offers a guaranteed income level. Assume a person can receive a maximum EITC benefit of $5,000 when earned income is $0; however, the maximum benefit is reduced at a 40% phase-out rate for each dollar earned beyond $0.
If 40% is the phase-out rate, what is the marginal tax rate on EITC benefits if earned income is $0.
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- Consider a EITC program that offers a guaranteed income level. Assume a person can receive a maximum EITC benefit of $5,000 when earned income is $0; however, the maximum benefit is reduced at a 40% phase-out rate for each dollar earned beyond $0. If 40% is the phase-out rate, what is the marginal tax rate on EITC benefits if earned income is greater than thebreak-even point?Suppose you are in the 25% marginal tax bracket and earn $15,000. Then a tax credit of $1500 will reduce your tax bill by how much?Suppose that Thomas Lee is enrolled in a defined contribution plan in which the employer contributes $8,000 each year. Thomas is earning $80,000 this year and his tax rate is 30 percent (which is not expected to change). Assume that the before- tax rate of return is 8 percent. (a) What is the additional amount of funds that Thomas will have when he reaches retirement in 10 years as a result of this year's service? (b) Suppose that Thomas's employer is planning to reduce half of their contribution to the defined contribution plan. Assume that Thomas would like to keep his retirement funds the same as they would have been with the defined contribution plan. If Thomas's only opportunity to save for retirement is in a nonqualified savings plan (no tax benefits), how much would Thomas need to receive in additional salary (which he would then save) to achieve his objective?
- The statutory marginal tax rate for income levels between $0 and $100,000 is 25%. The statutory marginal tax rate for income levels above $100,000 is 50%. A family with a child purchases 800 hours of childcare per year. The hourly rate for childcare was $10 in 2020. Families can deduct childcare expenditures up to $8,000. One spouse worked during the year while the other spouse did not earn income. The spouse that worked can claim a tax credit of $6,000. There is an inflation rate of 100% between 2020 and 2021. The family that earned $100,000 in 2020 earns $200,000 in 2021. The hourly wage of childcare also doubles to $20 in 2021. There is no change in income brackets used to calculate tax liabilities, tax credits, or deduction limits. What is the effective tax rate?The manager of Pharoah is given a bonus based on net income before taxes. The net income after taxes is $75980 for FIFO and $64500 for LIFO. The tax rate is 30%. The bonus rate is 20%. How much higher is the manager's bonus if FIFO is adopted instead of LIFO?Chase Cutter has a marginal tax rate of 33 percent, a state income tax rate of 3.5 percent, and a city income tax rate of 0.5 percent. The tax for Social Security and Medicare is 7.65 percent. What would be the effective marginal tax rate on your last dollar of earnings?
- In connection with the previous problem, suppose a certain governmentemployee earns a performance benefit = ₱2,340/month, 13 th Month Pay =₱15,780.43, and he has other benefits amounting to ₱6,000. How much of theadditional earnings will be taxed?Suppose a taxpayer can time when they receive a $100,000 distribution from a pre-tax 401(k) retirement account (this tax year or next). If they wait until next year, they will earn 10% on the account. The distribution is fully taxable at the marginal tax rate of the taxpayer, which is 24% for this year. What would be the marginal tax rate NEXT YEAR to just make the distribution financially advantageous this tax year? Enter your response as a whole number percent without the "%" sign and using 5/4 rounding (25.67% = 26).1. Suppose you currently earn taxable income of $100,000 per year. You are subject to an MTR of 50 percent. Currently, your ATR is 35 percent. Calculate your annual tax. Calculate the extra tax that you would pay per year if your annual income increased to $110,000. What is your ATR when your annual income is $110,000?
- 4. Suppose that Thomas Lee is enrolled in a defined contribution plan in which the employer contributes $8,000 each year. Thomas is earning $80,000 this year and his tax rate is 30 percent (which is not expected to change). Assume that the before- tax rate of return is 8 percent. (a)What is the additional amount of funds that Thomas will have when he reaches retirement in 10 years as a result of this year's service? (b) Suppose that Thomas's employer is planning to reduce half of their contribution to the defined contribution plan. Assume that Thomas would like to keep his retirement funds the same as they would have been with the defined contribution plan. If Thomas's only opportunity to save for retirement is in a nonqualified savings plan (no tax benefits), how much would Thomas need to receive in additional salary (which he would then save) to achieve his objective?What number of visits is required to provide you with an after-tax profit of $100,000? Tax is 30%, fixed costs are $257,500 and contributions costs per visit $34. My problem is where and how in to plugg in the 30% tax. Could you show me your answer including your 30% tax conversion.The company is planning to provide services to a client and receives $90,000 in year 2020. The client has the option to pay the money in the current year or over the next 3 years. Accordingly, Pioneer has the option of reporting the profit in the current year or over the next 3 years. Assume that Pioneer’s uses 9% discount rate and its marginal tax rate is 35% in year 2020 and 40% in the next three years. Which option should the company select? And why
