Part 2. Income tax - 4pts. - Apply to The Tax Cuts and Jobs Act of 2017 lowered the federal tax rate on most people and restructured the tax brackets Currently, for those in America who earn the most income, the federal marginal tax rate (the tax on the last dollar of carings) is about 37% See the chart below for the federal 2019 marginal tax rates Marginal Tax Married Filing Married Fling Rate Single Head of Household Jointly Separately 10% 50-59,700 50-519.400 $0-$9,700 50-$13,850 12% 59.701-539.475 $19.401-578,950 $13.851-552.850 59,701-539.475 22% $39.476-584.200 $78,951-$168.400 $52,851-584,200 $39.476-584 200 24% $84.201-$160,725 5168,401-5321,450 $84,201-$150.700 $84.201-5150.725 32% $160,726-S204,100 $321,451-5408.200 $160.701-5204,100 $160,726-5204,100 35% $204,101-5510,300 $408.201-5612.350 $204, 101-5306,175 5204,101-5510,300 37% Over $306,175 Over $510,300 Over $612,350 Over $510,300 DATA SOURCE IRS Assume that when you graduate from GVSU, you land the job of your dreams that pays you $100,000 in salary, and you want to account for your income taxes in your new household budget. Since you took ECO 211 with Professor Rozelle and did this extra credit assignment, you know that if you are single, make S100K per year and are in the 24% tax bracket, you will not end up actually paying 24% of your wages in federal income taxes thanks to the marginal tax bracket system. Instead, you know that you will only owe 10% federal tax on the first 89,700 (5970 in tax) that you carn, and 12%. on the amount that you earn from $9,701 to $39,475 (53,573 in tax), and so forth. A. Using the tax brackets above, calculate the amount of federal tax you would owe in cach remaining tax bracket. 22% bracket (22% tax on your income between $39,476 and $84,200) 24% bracket (24% tax on your income between $84,201 and 100,000) B. Add up the amount of tax you would owe in cach of the 4 tax brackets. What is the total amount in taxes that you would end up owing on your new salary at the end of the year (not counting any deductions you might qualify for)? C. What percentage of your $100,000 income does this amount that you owe represent (your actual overall tax rate)? D. Find the state income tax flat rate in Michigan. How much state income tax would you owe on your salary (in addition to your federal income tax)? ($100,000 multiplied by the state tax rate) E. You have the chance to transfer to a new state for your job. What state currently has the highest state income tax? F.-G. Name a state that does not levy a state income tax and instead raises taxes through higher sales taxes, property taxes and other taxes. Do you think this is more or less efficient than an income tax? (Not looking for a specific answer, just your take on this.) Part 2. Income tax - 4pts. - Apply to The Tax Cuts and Jobs Act of 2017 lowered the federal tax rate on most people and restructured the tax brackets Currently, for those in America who earn the most income, the federal marginal tax rate (the tax on the last dollar of carings) is about 37% See the chart below for the federal 2019 marginal tax rates Marginal Tax Married Filing Married Fling Rate Single Head of Household Jointly Separately 10% 50-59,700 50-519.400 $0-$9,700 50-$13,850 12% 59.701-539.475 $19.401-578,950 $13.851-552.850 59,701-539.475 22% $39.476-584.200 $78,951-$168.400 $52,851-584,200 $39.476-584 200 24% $84.201-$160,725 5168,401-5321,450 $84,201-$150.700 $84.201-5150.725 32% $160,726-S204,100 $321,451-5408.200 $160.701-5204,100 $160,726-5204,100 35% $204,101-5510,300 $408.201-5612.350 $204, 101-5306,175 5204,101-5510,300 37% Over $306,175 Over $510,300 Over $612,350 Over $510,300 DATA SOURCE IRS Assume that when you graduate from GVSU, you land the job of your dreams that pays you $100,000 in salary, and you want to account for your income taxes in your new household budget. Since you took ECO 211 with Professor Rozelle and did this extra credit assignment, you know that if you are single, make S100K per year and are in the 24% tax bracket, you will not end up actually paying 24% of your wages in federal income taxes thanks to the marginal tax bracket system. Instead, you know that you will only owe 10% federal tax on the first 89,700 (5970 in tax) that you carn, and 12%. on the amount that you earn from $9,701 to $39,475 (53,573 in tax), and so forth. A. Using the tax brackets above, calculate the amount of federal tax you would owe in cach remaining tax bracket. 22% bracket (22% tax on your income between $39,476 and $84,200) 24% bracket (24% tax on your income between $84,201 and 100,000) B. Add up the amount of tax you would owe in cach of the 4 tax brackets. What is the total amount in taxes that you would end up owing on your new salary at the end of the year (not counting any deductions you might qualify for)? C. What percentage of your $100,000 income does this amount that you owe represent (your actual overall tax rate)? D. Find the state income tax flat rate in Michigan. How much state income tax would you owe on your salary (in addition to your federal income tax)? ($100,000 multiplied by the state tax rate) E. You have the chance to transfer to a new state for your job. What state currently has the highest state income tax? F.-G. Name a state that does not levy a state income tax and instead raises taxes through higher sales taxes, property taxes and other taxes. Do you think this is more or less efficient than an income tax? (Not looking for a specific answer, just your take on this.)