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25 July, 02:59

Assume tax rates on single individuals are 10% on taxable income up to $9,275, 15% on income of $9,276 to $37,650 and 25% on income of $37,651 to $91,150. What is the tax liability for a single individual with $52,000 of taxable income, which includes $2,000 of dividends?

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  1. 25 July, 04:10
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    total tax liability = $8771.25

    Explanation:

    given data

    taxable income up to $9,275 single individuals = 10 %

    income of $9,276 to $37,650 = 15 %

    income of $37,651 to $91,150 = 25 %

    solution

    we know here amount upto $9,275 is

    amount upto $9,275 = $9,275 * 10% = $927.50 ... 1

    and

    amount $9,276 to $37,650 = (37650 - 9276) * 15% = $4257.45 ... 2

    and

    amount $37,650 to $50,000 = (50000 - 37650) * 25% = $3587.50 ... 3

    so now add all 3 equation we get

    total tax liability = $927.5 + $4256.25 + $3587.5

    total tax liability = $8771.25

    Tax Bracket rate amount

    upto $ 9,275 10% $ 927.50

    next (37650-9275) $ 28,375 15% $ 4,256.25

    remaining $ 14,350 25% $ 3,587.50

    total $ 52,000 $ 8,771.25
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