Question
Single and Married Scenarios John and Susan are a couple but not yet married. They are contemplating the tax effects of getting married. John earns
Single and Married Scenarios
John and Susan are a couple but not yet married. They are contemplating the tax effects of getting married. John earns $210,000 and Susan earns $15,000. Ignore itemized deductions and possible children. You can refer to the text for standard deduction and tax rates or to instructions to Form 1040 (https://www.irs.gov/pub/irs-pdf/i1040gi.pdf )
Note: I am planning a series of these Scenarios with ever-increasing complexity. So besides this assignment carrying significant weight in itself, it is the basis for future assignments and therefore worth your investment of time, effort and careful analysis.
Complete the following table (2 points). Year 2018
John | Susan | Combined | John | Susan | |||
Earns | $ 210,000 | $ 15,000 | $ 225,000 | $ 210,000 | $ 15,000 | ||
A | B | A+B | C | D | E | D+E | |
John Single | Susan Single | John and Susan are NOT MARRIED. What is there combined tax? | John/Susan Married Filing Jointly (MFJ) | John - Married Filing Separately (MFS) | Susan - Married Filing Separately (MFS) | Combined John/Susan MFS | |
Standard deduction |
|
| NA |
|
|
| NA |
Taxable Income |
|
| NA |
|
|
| NA |
Tax |
|
|
|
|
|
|
|
Show calculations below | NA | NA |
II. Show tax calculations (for columns A, B, C, D, E (2 points)
A1. Copy and paste tables used Remember to use 2018 tables
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A2. Show calculations You can use any format, including Excel files, as long as they are easy to read. In other words, you can use a different style for your calculations, as long as I can follow your logic:
Taxable Income |
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Tax on first |
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Tax (per table, marginal rate 24%) |
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Tax on Remaining taxable income of |
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Tax (marginal rate 32%) |
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Total Tax |
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III. Comment on what you have learned (1 point; maximum of 0.5 for mediocre work to get 1.0 it must be interesting enough to be publishable in a newspaper).
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