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 $102,000 in salary. She received $12,000 of dividend income. She received $5,000 of interest income on bank accounts. She received $22,000 from the sale of Apple stock that was purchased 5 years prior to the sale at a cost of $9,000. She received $10,000 from the sale of Abbvie stock that was purchased 6 months prior to the sale at a cost of $7,500. Mary will take a standard deduction of $12,000.

NOTE: Long Term capital gains and dividends are taxed at 15% tax rate.

Calculate What is Marys federal tax liability? And what is her average tax rate?

Single Individuals If Your Taxable Income Is You Pay This Amount on the Base of the Bracket Plus This Percentage on the Excess over the Base (Marginal Rate) 10.096 12.0 Average Tax Rate at Top of Bracket 10.096 Up to $9,525 $9,525-$38,700 11.5 22.0 17.1 $0.00 952.50 4,453.50 14,089.50 32,089.50 45,689.50 150,689.50 24.0 $38,700-$82,500 $82,500-$157,500 $157,500-$200,000 $200,000-$500,000 Over $500,000 20.4 32.0 22.8 35.0 30.1 37.0 37.0 Married couples Filing Joint Returns You Pay This If Your Taxable Amount on the Income Is Base of the Bracket Plus This Percentage on the Excess over the Base (Marginal Rate) Average Tax Rate at Top of Bracket 10.0% 10.0% 12.0 11.5 22.0 17.1 Up to $19,050 $19,050-$77,400 $77,400-$ 165,000 $165,000-$315,000 $315,000-$400,000 $400,000-$600,000 Over $600,000 $0.00 1,905.00 8,907.00 28,179.00 64,179.00 91,379.00 161,379.00 24.0 20.4 32.0 22.8 35.0 26.9 37.0 37.0 Notes: 1. These are the 2018 tax rates that will be paid on tax returns due April 15, 2019. The income ranges at which each tax rate takes effect are indexed with inflation, so they change each year. 2. The average tax rates are always below the marginal rates, but in 2018 the average at the top of the brackets approach- es 37% as taxable income rises without limit. 3. In 2018, the personal exemption for the taxpayer and dependents was eliminated. With the deduction limitation on state and local property, income, and sales taxes and the existence of payroll taxes (Social Security and Medicare taxes). the 2018 effective tax rate will be higher than 37%