Question

1. Carol does not receive employer-funded health insurance benefits. However, she is offered an opportunity to purchase a health insurance plan for $1050 a month paid out of pretax dollars. How much tax does Carol save annually if her marginal tax rate is 24%?

A) $6300

B) $3024

C) $12600

D) $1050

2. Which of the following characteristics of the Medicare payroll tax make it regressive?

A) The same tax rate is paid by all taxpayers, regardless of income.

B) Benefits paid to high-income tax payers are greater than those paid to low-income taxpayers.

C) There is a cap on income subject to the tax.

Answer 1

1.
=1050*12*24%
=3024.00

2.
The same tax rate is paid by all taxpayers, regardless of income.