Question
Alan and Sara Winthrop are a married couple who file a joint income tax return. They have two children, so they claim a total of
Alan and Sara Winthrop are a married couple who file a joint income tax return. They have two children, so they claim a total of 4 exemptions ($4,050 for each exemption). In addition, they have legitimate itemized deductions totaling $25,750. Their total income from wages is $213,500. Assume the following tax table is applicable:
Married Couples Filing Joint Returns
| If Your Taxable Income Is | You Pay This Amount on the Base of the Bracket | Plus This Percentage on the Excess over the Base | Average Tax Rate at Top of Bracket |
| Up to $18,650 | $0.00 | 10.0% | 10.0% |
| $18,650-$75,900 | 1,865.00 | 15.0 | 13.8 |
| $75,900-$153,100 | 10,452.50 | 25.0 | 19.4 |
| $153,100-$233,350 | 29,752.50 | 28.0 | 22.4 |
| $233,350-$416,700 | 52,222.50 | 33.0 | 27.1 |
| $416,700-$470,700 | 112,728.00 | 35.0 | 28.0 |
| Over $470,700 | 131,628.00 | 39.6 | 39.6 |
What is their federal tax liability?
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Accounting Tools For Business Decision Making
Authors: Paul D. Kimmel, Jerry J. Weygandt, Jill E. Mitchell
8th Edition
1119791057, 978-1119791058
