Marginal tax rates Partner A, a single taxpayer, is one of two partners in a small business. As such, she receives pass-through income that is taxed at her personal tax rates. After all adjustments and deductions have been made, including the 20% qualified business income deduction, she is preparing to calculate her taxes owed for the year. Using the tax rate schedule given here (SEE BELOW) perform the following:

a. Find the marginal tax rate for the following levels of sole proprietorship earnings before taxes:

$16500, $58200, $91500, $151000, $251000, $452000 and $1.4 million

b. Plot the marginal tax rates (measured on the y-axis) against the pretax income levels (measured on the x-axis). Explain the relationship between these variables.

Tax Rate - Single Taxpayers -2018

Tax calculation Range of taxable income Base tax + (Marginal rate amount over base bracket)

$0 to $9,525 . $0 + (10% amount over $0)

9,525 to 38,700 953 + (12% amount over 9,525)

38,700 to 82,500 . 4,454 + (22% amount over 38,700)

82,500 to 157,500 14,090 + (24% amount over 82,500)

157,500 to 200,000 32,090 + (32% amount over 157,500)

200,000 to 500,000 45,690 + (35% amount over 200,000)

Over 500,000 150,690 + (37% amount over 500,000)

a. The marginal tax rate for earnings before taxes of $16,500 is .....%. (Round to the nearest integer.)