Question

Susan and Stan Britton are a married couple who file a joint income tax return, where the tax rates are based on the tax table 3.5. Assume that their taxable income this year was $275,000. Round your answers to two decimal places. What is their federal tax liability? $ What is their marginal tax rate? % What is their average tax rate? %

Answer 1

	Tax	Calculation
On first $50,000	$                 7,500	=50000*15%
On next $25,000	$                 6,250	=25000*25%
On next $25,000	$                 8,500	=25000*34%
On next $175,000	$               68,250	=175000*39%
Federal tax liability	$     90,500
Average tax rate	32.91%
	=90500/275000
Marginal tax rate	39%