Kimberly is considering a new job where she would earn $4000 more per year. With her current job and situation her tax is $3600. With her new pay raise her taxes would increase to $5200. What is Kimberlys marginal tax rate?(Round answers to 0 decimal place, e.g. 5275.)

a.50%.

b.40%.

c.60%.

d.70%.

Paul has gross income of $53500. Paul has taxable income of $37000 and paid taxes of $4280. What is Paul's effective tax rate? (Round answers to 1 decimal place, e.g. 52.7.)

a.8.0%.

b.11.6%.

c.16.5%.

d.None of the other answer choices are correct.

Which of the following refers to the amount remaining after the standard or itemized deduction?

a.AGI.

b.Gross income.

c.Taxable income.

d.Net income.

Failure to file a tax return when you have earned taxable income as an employee

a.will result in a penalty from the IRS, even if it was an accident.

b.will not result in a penalty unless the IRS finds you guilty of committing fraud.

c.will not be known by the IRS.

d.both will not result in a penalty unless the IRS finds you guilty of committing fraud and will not be known by the IRS.

A common tax credit available to college students just starting their education is the:

a .Lifetime Learning Credit.

b.Premium Tax Credit.

c.Earned Income Credit.

d.American Opportunity Credit.

An individuals effective tax rate is always _______ their marginal tax rate.

a.equal to

b.higher than

c.Effective tax rates have no relation to marginal tax rates.

d.lower than

Which of the following is more valuable for the tax payer?

a.Kiddie tax credit.

b.$1,000 tax deduction.

c.A tax credit and a tax deduction are the same values.

d.$1,000 tax credit.

Negative effective income tax rates result from:

a.negative tax bracket rates applied to low-income households.

b.nonrefundable tax credits.

c.refundable tax credits.

d.negative tax bracket rates, nonrefundable tax credits, and refundable tax credits.

Traditional IRAs may allow you to achieve which of the following?

I.		Tax free distributions.
II.		Tax-deferred growth.
III.		Reduce current taxable income.

a.I and II.

b.I, II, and III.

c.I only.

d.II and III only.