Question

if your household income is $60,000 and you are in the tax bracket of [$50,001-$75,000], with...

if your household income is $60,000 and you are in the tax bracket of [$50,001-$75,000], with tax rate listed as “25%”,

your average tax rate is 25%

your marginal tax rate is 25%

Homework Answers

Answer #1

Hello

YOUR REQUIRED ANSWER IS : your marginal tax rate is 25%

Given that the household income is $60,000 falling between $50,001 and $75,000 with tax rate listed as 25%, we can say that the marginal tax rate is 25%.

Marginal tax rate is the rate of tax which we have to pay on 1$ if we earn 1extra $ from our current level of income and hence, it is 25%,

while Average Tax Rate = Total Tax/ Total Income, which in case, it will vary if the tax rates in other brackets lower than $50,001 is anything ither than 25%.

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