Question
Ed and Jane Rochester are married with a 2-year-old child, who lives with them and whom they support financially. In 2020, Ed and Jane realized
Ed and Jane Rochester are married with a 2-year-old child, who lives with them and whom they support financially. In 2020, Ed and Jane realized the following items of income: Eds salary $30,000 Janes salary $70,000 Municipal bond interest income $400 Jane and Ed incurred $12,750 of itemized deductions in 2020. Their employer withheld $5,800 in federal income taxes from their paychecks (in aggregate). Finally, Ed and Janes 2-year-old child qualifies for the $2,000 child tax credit. Compute Jane and Eds tax due or (refund) for 2020. What is Jane and Eds 2020 marginal tax rate? Show all your work.
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