Question
In: Accounting
Single Taxpayers Married Taxpayers Filing Joint Returns Tax Rate (%) 0-$9,275 0-$18,550 10.0 $9,276-$37,650 $18,551-$75,300 15.0...
|
Single Taxpayers |
Married Taxpayers Filing Joint Returns |
Tax Rate (%) |
|
0-$9,275 |
0-$18,550 |
10.0 |
|
$9,276-$37,650 |
$18,551-$75,300 |
15.0 |
|
$37,651-$91,150 |
$75,301-$151,900 |
25.0 |
|
$91,151-$190,150 |
$151,901-$231,450 |
28.0 |
|
$190,151-$413,350 |
$231,451-$413,350 |
33.0 |
|
$413,351-$415,050 |
$413,351-$466,950 |
35.0 |
|
$415,051 and above |
$466,951 and above |
39.6 |
Based on this table, answering the following questions:
(Please show your intermediate processes, instead of just a final number for your answers. Only round your final answers to two decimal places.)
(a1) Suppose there is a person called Alpha who has an annual income of $300,000 and Alpha’s spouse has an annual income of $20,000. What dollar amount of tax do Alpha and Alpha’s spouse each need to pay respectively, if they choose to file their taxes separately? What dollar amount of tax do they need to pay if they choose to file their taxes jointly?
(a2) What are the average tax rates for Alpha and Alpha’s spouse respectively, if they choose to file separately? What is the average tax rate if they choose to file jointly?
(b1) Suppose there is another person called Beta who has an annual income of $160,000 and Beta’s spouse also has an annual income of $160,000. What dollar amount of tax do Beta and Beta’s spouse each need to pay respectively, if they choose to file their taxes separately? What dollar amount of tax do they need to pay if they choose to file their taxes jointly?
(b2) What are the average tax rates for Beta and Beta’s spouse respectively, if they choose to file separately? What is the average tax rate if they choose to file jointly?
(c) Based on what you obtained from (a1) to (b2), what are the conclusions you could infer regarding the ways of filing taxes? (What are the advantages and disadvantages of these two ways?)
Solutions
Expert Solution
| Filling Separately | Filling Jointly | ||||||||
| Income Slab | Tax Rate | Alpha | Spouse | Total | Income Slab | Tax Rate | Alpha | Spouse | Total |
| Annual Income (A) | $ 300,000 | $ 20,000 | $ 320,000 | Annual Income (A) | $ 300,000 | $ 20,000 | $ 320,000 | ||
| 0-$9,275 | 10% | $ 928 | $ 928 | $ 1,855 | 0-$18,550 | 10% | $ 1,855 | ||
| $9,276-$37,650 | 15% | $ 4,256 | $ 1,609 | $ 5,865 | $18,551-$75,300 | 15% | $ 8,512 | ||
| $37,651-$91,150 | 25% | $ 13,375 | $ - | $ 13,375 | $75,301-$151,900 | 25% | $ 19,150 | ||
| $91,151-$190,150 | 28% | $ 27,720 | $ - | $ 27,720 | $151,901-$231,450 | 28% | $ 22,274 | ||
| $190,151-$413,350 | 33% | $ 36,250 | $ - | $ 36,250 | $231,451-$413,350 | 33% | $ 29,221 | ||
| $413,351-$415,050 | 35% | $ - | $ - | $ - | $413,351-$466,950 | 35% | $ - | ||
| $415,051 and above | 40% | $ - | $ - | $ - | $466,951 and above | 40% | $ - | ||
| a1 Total Tax (B) | $ 82,528 | $ 2,536 | $ 85,064 | Total Tax (B) | $ 81,012 | ||||
| a2 Average Tax Rate (B / A)X100 | 28% | 13% | 27% | Average Tax Rate (B / A)X100 | 25% | ||||
| Filling Separately | Filling Jointly | ||||||||
| Income Slab | Tax Rate | Beta | Spouse | Total | Income Slab | Tax Rate | Alpha | Spouse | Total |
| Annual Income (A) | $ 160,000 | $ 160,000 | $ 320,000 | Annual Income (A) | $ 160,000 | $ 160,000 | $ 320,000 | ||
| 0-$9,275 | 10% | $ 928 | $ 928 | $ 1,855 | 0-$18,550 | 10% | $ 1,855 | ||
| $9,276-$37,650 | 15% | $ 4,256 | $ 4,256 | $ 8,512 | $18,551-$75,300 | 15% | $ 8,512 | ||
| $37,651-$91,150 | 25% | $ 13,375 | $ 13,375 | $ 26,750 | $75,301-$151,900 | 25% | $ 19,150 | ||
| $91,151-$190,150 | 28% | $ 19,278 | $ 19,278 | $ 38,555 | $151,901-$231,450 | 28% | $ 22,274 | ||
| $190,151-$413,350 | 33% | $ - | $ - | $ - | $231,451-$413,350 | 33% | $ 29,221 | ||
| $413,351-$415,050 | 35% | $ - | $ - | $ - | $413,351-$466,950 | 35% | $ - | ||
| $415,051 and above | 40% | $ - | $ - | $ - | $466,951 and above | 40% | $ - | ||
| b1 Total Tax (B) | $ 37,836 | $ 37,836 | $ 75,672 | Total Tax (B) | $ 81,012 | ||||
| b2 Average Tax Rate (B / A)X100 | 24% | 24% | 24% | Average Tax Rate (B / A)X100 | 25% |
ekkarill92 answered 1 year agoRelated Solutions
Mikey and Sal, married taxpayers filing a joint return, paid state income tax of $12,000 and...
Mikey and Sal, married taxpayers filing a joint return, paid
state income tax of $12,000 and other itemized deductions of
$15,000 in 2020. Because the total of their allowable itemized
deductions exceeded the standard deduction, they elected to itemize
deductions on their 2020 federal income tax return rather than to
claim the standard deduction. In May 2021, Mikey and Sal receive a
refund of $1,000 for overpaid state income taxes paid in 2020.
Under the tax benefit rule, how much...
In 2020, John and Emma, married filing joint taxpayers, have adjusted gross income of $430,000. Their...
In 2020, John and Emma, married filing joint taxpayers, have
adjusted gross income of $430,000. Their AGI includes $10,000 of
interest income. They have no dependents and have $50,000 of
itemize deductions. What is their 2020 federal income tax?
A) $83,631 B) $83,829 C) $89,212 D) $89,404
In 2020, Raoul & Ayesha , married filing joint taxpayers, have adjusted gross income of $430,000....
In 2020, Raoul & Ayesha , married filing joint taxpayers,
have adjusted gross income of $430,000. Their AGI includes $10,000
of interest income. They have no dependents and have $50,000 of
itemize deductions. What is their 2020 federal income tax? (PLEASE
SHOW ALL WORK)
A) $83,631
B) $83,829
C) $89,212
D) $89,404
Jasper and Crewella Dahvill were married in year 0. They filed joint tax returns in years...
Jasper and Crewella Dahvill were married in year 0. They filed
joint tax returns in years 1 and 2. In year 3, their relationship
was strained and Jasper insisted on filing a separate tax return.
In year 4, the couple divorced. Both Jasper and Crewella filed
single tax returns in year 4. In year 5, the IRS audited the
couple’s joint year 2 tax return and each spouse’s separate year 3
tax returns. The IRS determined that the year 2...
Jasper and Crewella Dahvill were married in year 0. They filed joint tax returns in years...
Jasper and Crewella Dahvill were married in year 0. They filed
joint tax returns in years 1 and 2. In year 3, their relationship
was strained and Jasper insisted on filing a separate tax return.
In year 4, the couple divorced. Both Jasper and Crewella filed
single tax returns in year 4. In year 5, the IRS audited the
couple’s joint year 2 tax return and each spouse’s separate year 3
tax returns. The IRS determined that the year 2...
Joseph and Maxie Stottlemyre are married and filing a joint tax return. Their taxable incomes for...
Joseph and Maxie Stottlemyre are married and filing a joint tax
return. Their
taxable incomes for the year were $27,522 (Joseph) and $24,074
(Maxie). Their
W-2 forms show that they already have paid $8315in income taxes
for the year.
Are they correct in assuming that they will receive a tax
refund? If so, how much
will it be? Otherwise, how much will they still owe?
(10) 11. Would Joseph and Maxie have paid more or less tax if
they had...
filing 2019 tax returns, Scott and Glenna are married with two dependent children. They have $74,000...
filing 2019 tax returns, Scott and Glenna are married with two
dependent children. They have $74,000 in wage income and $4,600 in
interest income on some bonds they own. They have deductions for
adjusted gross income of $4,000 and itemized deductions of $24,600.
Neither of the children has any income. Determine the tax savings
for the family if Scott and Glenna were to transfer the bonds to
the children, both under 18.
Brian and Corrine Lee are married taxpayers filing jointly. They live in the home they own,...
Brian and Corrine Lee are married taxpayers filing jointly. They
live in the home they own, located at 3301 Pacific Coast Hwy.,
Laguna Beach, CA 92651. Brian is an optometrist who owns his
business; Corrine is a social worker for Orange County. They have
two sons, Brady and Hank. During their trip to China last year,
they fell in love with a beautiful 1-year-old girl from an
orphanage near Shanghai and are in the process of adopting her. The
social...
Schedule Married Joint Taxable income over: But not over: The tax is: $0 $18,650 10% of...
Schedule Married Joint
Taxable income over: But not over: The tax is:
$0 $18,650 10% of taxable income
$18,650 $75,900 $1,865 plus 15% of the excess over
$18,650
$75,900 $153,100 $10,452.50 plus 25% of the excess over
$75,900
$153,100 $233,350 $29,752.50 plus 28% of the excess over
$153,100
$233,350 $416,700 $52,222.50 plus 33% of the excess over
233,350
$416,700 $470,700 $112,728.00 plus 35% of the excess over
$416,700
$470,700 - $131,628.00 plus 39.6% of the excess over
$470,700
During the...
Which of the following taxpayers need not file a tax return for 2019? Married taxpayers (ages...
Which of the following taxpayers need not file a tax return for
2019?
Married taxpayers (ages 69 and 67 years), filing jointly, with
gross income of $26,724.
An unmarried taxpayer who is over age 65, with gross income of
$20,771.
An unmarried taxpayer, under age 65, with gross income of
$26,058.
An unmarried taxpayer, over age 65, filing as head of household
with gross income of $20,830.
All of the above taxpayers must file a return.
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Suppose a company is looking to hedge a risk in the derivatives market. What, fundamentally, is...
- Training and Development assignment. Describe the usage of Computer Based Training (CBT) in McDonald's Company training...
- PUT IN JAVA PROGRAMMING LANGUAGE The Rectangle class: Design a class named Rectangle to represent a...
- Journal article summary on inter-group conflict Peer Reviewed Journal article from past 3 years. Please include...
- "Ethical Considerations" Please respond to the following: Reflect upon the responsibilities placed on auditors by the...
- A Japanese company has a bond outstanding that sells for 93 percent of its ¥100,000 par...
- What is the difference among the principles of modularization, abstraction, encapsulation, and separation of interface and...
ADVERTISEMENT