In: Finance
Tax Table | Rate | |
$0 | $9,525 | 10% |
$9,525 | $38,700 | 12% |
$38,700 | $82,500 | 22% |
$82,500 | $157,500 | 24% |
$157,500 | $200,000 | 32% |
Given the tax table provided, compute the tax on $27,005 of taxable income.
Answer to the nearest dollar, use commas when appropriate, but do not include the $ in your answer.
Tax calculation is as follows:
Lower limit | Upper limit | Tax rate | Income taxable in this bracket | Tax | Remaining income |
- | 9,525.00 | 0.10 | 9,525.00 | 952.50 | 17,480.00 |
9,525.00 | 38,700.00 | 0.12 | 17,480.00 | 2,097.60 | - |
38,700.00 | 82,500.00 | 0.22 | - | - | - |
82,500.00 | 1,57,500.00 | 0.24 | - | - | - |
1,57,500.00 | 2,00,000.00 | 0.32 | - | - | - |
Total | 27,005.00 | 3,050.10 |
Income taxable in this bracket = upper limit - lower limit of
the bracket
Tax = Income taxable in this bracket x Tax rate of the
bracket
Remaining income = EBT- Total income taxed in all previous
brackets
So total tax payable = 3,050.10 os 3,050 rounded to the
nearest dollar