| 2013 Individual Tax Rates | |||
| Single Individuals | |||
If a Corporation's Taxable Income Is |
It Pays This Amount on the Base of the Bracket |
Plus This Percentage on the Excess over the Base (Marginal Rate) |
Average Tax Rate at Top of Bracket |
| Up to $8,925 | $0 | 10.0% | 10.0% |
| $8,925 - $36,250 | 892.50 | 15.0 | 13.8 |
| $36,250 - $87,850 | 4,991.25 | 25.0 | 20.4 |
| $87,850 - $183,250 | 17,891.25 | 28.0 | 24.3 |
| $183,250 - $398,350 | 44,603.25 | 33.0 | 29.0 |
| $398,350 - $400,000 | 115,586.25 | 35.0 | 29.0 |
| Over $400,000 | 116,163.75 | 39.6 | 39.6 |
Standard deduction for individual: $6,100
| Married Couples Filing Joint Returns | |||
If a Corporation's Taxable Income Is |
It Pays This Amount on the Base of the Bracket |
Plus This Percentage on the Excess over the Base (Marginal Rate) |
Average Tax Rate at Top of Bracket |
| Up to $17,850 | $0 | 10.0% | 10.0% |
| $17,850 - $72,500 | 1,785.00 | 15.0 | 13.8 |
| $72,500 - $146,400 | 9,982.50 | 25.0 | 19.4 |
| $146,400 - $223,050 | 28,457.50 | 28.0 | 22.4 |
| $223,050 - $398,350 | 49,919.50 | 33.0 | 27.1 |
| $398,350 - $450,000 | 107,768.50 | 35.0 | 28.0 |
| Over $450,000 | 125,846.00 | 39.6 | 39.6 |
Standard deduction for married couples filing jointly: $12,200
Quantitative Problem: Jenna is a single
taxpayer with no dependents so she qualifies for one personal
exemption. During 2013, she earned wages of $101,000. She doesn't
itemize deductions, so she will take the standard deduction and her
personal exemption to calculate 2013 taxable income. In addition,
during the year she sold common stock that she had owned for five
years for a net profit of $7,000. How much does Jenna owe to the
IRS for taxes? Round your intermediated and final answers to the
nearest cent.
$??????
Calculation of Net Taxable Income of Jenna :-
| Particulars | Amount($) |
| Wages Earned | 101000 |
| Less: Standard Deduction for individual | (6100) |
| Taxable Income ($101000-$6100) | 94900 |
| Less: Personal Exemption | (3900) |
| Net Taxable Income ($94900 - $3900) | 91000 |
Calculation of Tax :-
As per Slab = $17891.25 + ($91000 - $87850) * 28%
= $17891.25 + ($3150*28%)
= $17891.25 + $882
= $18773.25
Tax on Long term Gain :-
= $7000 * 15%
= $1050
Total Tax = $18773.25 + $1050 = $19823.25
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