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Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information:
Mary Jarvis is a single individual who is working on filing her tax return for the previous year. She has assembled the following relevant information:
- She received $129,000 in salary.
- She received $19,500 of dividend income.
- She received $5,300 of interest income on Home Depot bonds.
- She received $24,500 from the sale of Disney stock that was purchased 2 years prior to the sale at a cost of $5,200.
- She received $10,000 from the sale of Google stock that was purchased 6 months prior to the sale at a cost of $5,100.
- Mary receives one exemption ($4,000), and she has allowable itemized deductions of $7,500. These amounts will be deducted from her gross income to determine her taxable income.
What is Mary's federal tax liability? Round your answer to the nearest cent. Do not round intermediate calculations. (in $)
What is her marginal tax rate? Round your answer to 1 decimal place. (in %)
What is her average tax rate? Round your answer to 2 decimal places. (in %)
Salary $129,000.00 Tax Table for Single Individuals:......... Taxable income Dividend Income Interest Income LT Stock Sale LT Stock Cost ST Stock Sale ST Stock Cost Personal Exemption Itemized Deductions Apllicable Tax Rate on Dividends & LT Capital Gains $19,500.00 $5,300.00 $24,500.00 $5,200.00 $10,000.00 $5,100.00 $4,000.00 $7,500.00 15.00% $0.00 $9,225.00 $37,450.00 $90,750.00 $189,750.00 $411,500.00 $413,200.00 Amount Paid on Base $0.00 $922.50 $5,156.25 $18,481.25 $46,075.25 $119,401.25 $119,996.25 Percentage on Excess over Base 10.00% 15.00% 25.00% 28.00% 33.00% 35.00% 39.60% Single Individuals If Your Taxable Income Is Up to $9,225 $9,225-537,450 $37,450 $90,750 $90,750-$189,750 $189,750-$411,500 $411,500-$$413,200 Over $413,200 You Pay This Amount on the Base of the Bracket 0 922.50 5,156.25 18,481.25 46,075.25 119,401.25 119,996.25 Plus This Percentage on the Excess over the Base Marginal Rate) 10.0% 15.0 25.0 28.0 33.0 35.0 39.6 Average Tax Rate at Top of Bracket 10.0% 13.8 20.4 24.3 29.0 29.0 39.6 Married Couples Filing Joint Returns You Pay This Amount on the Base of the Bracket If Your Taxable Income Is Up to $18,450 $18,450-$74,900 $74.900-5151,200 $151,200-$230,450 $230,450-$411,500 $411,500-$464,850 Over $464,850 0 Plus This Percentage on the Excess over the Base (Marginal Rate) 10.0% 15.0 25.0 28.0 Average Tax Rate at Top of Bracket 10.0% 13.8 19.4 22.4 1,845.00 10,312.50 29,387.50 51,577.50 111,324.00 129,996.50 35.0 27.1 28.0 39.6 39.6Step by Step Solution
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