Question
In: Economics
(2012 tax bracket) A. using the table, what is the total federal income tax bill for...
(2012 tax bracket)
A. using the table, what is the total federal income tax bill for someone who makes $67,000 per year? (show calculations)
B. using the table, what is the average tax rate for someone who makes $67,000 per year? (show calculations)
Solutions
Expert Solution
A.
As per the tax bracket of the year 2012, an unmarried who has taxable income of $67,000 should fall under 25% tax bracket. The corresponding tax bill amount is as below:
Tax bill amount = 4867.50 + (67000 – 35350) × 25%
= 4867.50 + 31650 × 25%
= 4867.50 + 7912.50
= $12,780 (Answer)
B.
Average tax rate = (Tax bill amount / Taxable income) × 100
= (12,780 / 67,000) × 100
= 19.07% (Answer)
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