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lutik1710 [3]
3 years ago
12

Mitch, a single taxpayer, earns $100,000 in taxable income and $10,000 in interest from an investment in city of Birmingham Bond

s. Using the U.S. tax rate schedule for year 2020, what is his average tax rate (rounded)

Business
1 answer:
omeli [17]3 years ago
3 0

Answer: $18,079.5‬0

Explanation:

The tax is to be paid on the $100,000 alone as the $10,000 is municipal interest and is therefore tax exempt.

Taxes on the $100,000 in 2020;

= 14,605.50 + ( 24% of any amount above 85,525)

= 14,605.50 + ( 24% * ( 100,000 - 85,525))

= $18,079.5‬0

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