Question
Suppose you are a typical person in the U.S. economy. You pay 4 percent of your income in a state income tax and 15.3 percent
Suppose you are a typical person in the U.S. economy. You pay 4 percent of your income in a state income tax and 15.3 percent of your labor earnings in federal payroll taxes (employer and employee shares combined). You also pay federal income taxes as in the following table:
On Taxable Income... | The Tax Rate Is... |
---|---|
From $0 to $9,075 | 10.0% |
From $9,076 to $36,900 | 15.0% |
From $36,901 to $89,350 | 25.0% |
From $89,351 to $186,350 | 28.0% |
From $186,351 to $405,100 | 33.0% |
From $405,101 to $406,750 | 35.0% |
From $406,751 and above | 39.6% |
Complete the following table with how much tax of each type you pay if you earn $30,000 a year. (Note: Ignore any credits or deductions of one tax type on other tax liabilities.)
Tax Type | Amount |
---|---|
(Dollars) | |
State Income Tax | |
Federal Payroll Tax | |
Federal Income Tax |
Taking all taxes into account, your average tax rate is and your marginal tax rate is .
Complete the following table with how much tax of each type you pay if you earn $60,000 a year.
Tax Type | Amount |
---|---|
(Dollars) | |
State Income Tax | |
Federal Payroll Tax | |
Federal Income Tax |
Taking all taxes into account, your average tax rate is , and your marginal tax rate is in this case.
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