Question

Q1a.
Thomas Fortuna (married; 4 federal withholding allowances) earned weekly gross pay of $765. For each period, he makes a 401(k) retirement plan contribution of 11% of gross pay.
Using wage-bracket method: Federal income tax withholding = $_________________

Q1b.
Barbara Houlihan (single; 1 federal withholding allowance) earned daily gross pay of $310. For each period, she makes a 401(k) contribution of 11.5% of gross pay.
Using wage-bracket method: Federal income tax withholding = $ ______________
Using percentage method: Federal income tax withholding = $ _____________

Q1c.
Marcus Xavier (married; 5 federal withholding allowances) earned monthly gross pay of $3,670. He participates in a flexible spending account, to which he contributes $215 during the period.
Using wage-bracket method: Federal income tax withholding = $_________________

* ** *NOTE: For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.
- - For each employee listed, use both the wage-bracket method and the percentage method to calculate federal income tax withholding.Refer to Appendix A, 2018 Federal Tax Tables in your textbook.

Answer 1

Thomas Fortuna	Married
Gross Pay - Weekly	$765
401(k) retirement plan	$     84.15
Allowance	4
Amount subject to withholding	$680.85
Federal income tax withholding - (Wage)	$     14.00
Barbara Houlihan	Single
Gross Pay - Daily	$310
401(k) retirement plan	$     35.65
Allowance	1
Amount subject to withholding	$274.35
Federal income tax withholding - (Wage)	$     38.00
Gross Pay - Daily	$310
401(k) retirement plan	$     35.65
Allowance (1*16)	$     16.00
Amount subject to withholding	$258.35
Federal income tax withholding - (Percentage)	$     38.09
17.13+(258.35-163.1)*22%
Marcus Xavier	Married
Gross Pay - Monthly	$3,670
Flexible spending account	$   215.00
Allowance	5
Amount subject to withholding	$3,455.00
Federal income tax withholding - (Wage)	$     76.00