Question

Rebecca and Roberto have adjusted gross incomes of $47,400 and $32, 500​, respectively. Assume that each person takes one exemption and the standard deduction. Answer parts ​(a) through ​(c) below.

Tax Rate Single Married Filing Jointly ​10% up to​ $8,925 up to ​$17,850 ​15% up to​ $36,250 up to​ $72,500 ​25% up to​ $87,850 up to​ $146,400 ​28% up to​ $183,250 up to​ $223,050 Standard Deduction ​$6100 ​$12,200 Exemptions​ (per person) ​$3900 ​$3900

a. Calculate the tax owed by the couple if they delay their marriage until next year so they can each file a tax return at the single tax rate this year.

The couple owes

​$nothing.

​(Simplify your answer. Round to the nearest dollar as​ needed.)

b. Calculate the tax owed by the couple if they marry before the end of the year and file a joint return.

The couple owes

​$nothing.

​(Simplify your answer. Round to the nearest dollar as​ needed.)

c. Does the couple face a​ "marriage penalty" if they marry before the end of the​ year?

NoNo

Yes

Answer 1

SOLUTION:

Given That Rebecca and Roberto have adjusted gross incomes of $47,400 and $32, 500​, respectively. Assume that each person takes one exemption and the standard deduction.

SO

(a)

Calculate the tax owed by the couple if they delay their marriage until next year so they can each file a tax return at the single tax rate this year.

The couple owes:

Taxable income of Katie = AGI – standard deduction – person exemption = 47000-6100-3900 = 37000

Tax liability of Katie = (8925*10%)+(15%*(36250-8925))+(25%*(37000-36250)) = $5178.75

Taxable income of Roberto = AGI – standard deduction – person exemption = 32800-6100-3900 = 22800

Tax liability of Katie = (8925*10%)+(15%*(22800-8925)) = $2973.75

Total tax = 5178.75+1973.75 = $8152.5 = $8153

(b)

Calculate the tax owed by the couple if they marry before the end of the year and file a joint return.

The couple owes:

Total taxable income of couple = (47000+32500)-12200-(3900*2) = $59500

Tax liability of couple = (17850*10%)+(15%*(59800-17850)) = $8032

(c).

Does the couple face a​ "marriage penalty" if they marry before the end of the​ year:

so the answer is ==>YES