Laine works for Bash Consulting. Laine is paid bi-weekly and in the current pay period had gross pay of $5,000. Laine is single, and claimed 4 withholding allowances on the form W-4. Before considering this current paycheck Laine had already earned $126,000 of cumulative pay (i.e. year-to-date).

Applicable payroll tax rates are: FICA tax for Social Security is 6.2% on the first $127,200 of earnings each calendar year and the FICA tax for Medicare is 1.45% of all earnings. The FUTA tax rate is 0.6%, and the SUTA tax rate is 5.4%. Both unemployment taxes are applied to the first $7,000 of an employees pay.

How much of the current $5,000 paycheck will Laine take home? (Round your final answer to the nearest $1).

A.

$4,207

B.

$4,122

C.

$4,354

D.

$3,832

E.

$4,067

Payroll Period Weekly Biweekly Semimonthly Monthly Quarterly Semiannually Annually Daily or miscellaneous (each day of the payroll period) One Withholding Allowance $ 80.80 161.50 175.00 350.00 1,050.00 2,100.00 4,200.00 16.20 TABLE 2-BIWEEKLY Payroll Period (a) SINGLE person (including head of household)- |(b) MARRIED person- If the amount of wages If the amount of wages (after subtracting The amount of income tax (after subtracting The amount of income tax withholding allowances) is: to withhold is: withholding allowances) is: to withhold is: Not over $146 $0 Not over $454 $0 Over- But not over- of excess over-Over- But not over- of excess over- $146 -$519 $0.00 plus 10% --$146 $454 -$1,200 $0.00 plus 10% -$454 $519 -$1,664 $37.30 plus 12% -$519 $1,200 -$3,490 .. $74.60 plus 12% -$1,200 $1,664 -$3,385 $174.70 plus 22% -$1,664 $3,490 -$6,931 $349.40 plus 22% -$3,490 $3,385 --$6,328 $553.32 plus 24% -$3,385 $6,931 -$12,817 $1,106.42 plus 24% -$6,931 $6,328 -$7,996 $1,259.64 plus 32% -$6,328 $12,817 -$16,154 $2,519.06 plus 32% -$12,817 $7,996 -$19,773 $1,793.40 plus 35% -$7,996 $16,154 - $24,006 $3,586.90 plus 35% -$16,154 $19,773 $5,915.35 plus 37% -$19,773 $24,006 $6,335.10 plus 37% --$24,006