Jillian and Gus are married and file a joint return. They expect to have $180,000 of taxable income in the next year and are considering whether to purchase a personal residence that would provide additional tax deductions of $36,000 for mortgage interest and real estate taxes.

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Requirement a. What is their marginal tax rate for purposes of making this decision? (Enter amounts as percentages to one decimal place.)

What is the marginal tax rate if the personal residence is not purchased?		%
What is the marginal tax rate if the personal residence is purchased?

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If taxable income is:	The tax is:
Not over $19,050	10% of taxable income.
Over $19,050 but not over $77,400	$1,905.00 + 12% of the excess over $19,050.
Over $77,400 but not over $165,000	$8,907.00 + 22% of the excess over $77,400.
Over $165,000 but not over $315,000	$28,179.00 + 24% of the excess over $165,000.
Over $315,000 but not over $400,000	$64,179.00 + 32% of the excess over $315,000.
Over $400,000 but not over $600,000	$91,379.00 + 35% of the excess over $400,000.
Over $600,000	$161,379.00 + 37% of the excess over $600,000.