Miley, a single taxpayer, plans on reporting $29,700 of taxable income this year (all of her income is from a part-time job). She is considering applying for a second part-time job that would give her an additional $10,000 of taxable income. By how much will the income from the second job increase her tax liability? (Use the tax rate schedules)

Question

Quizplus · Accepted Answer

Based on the single tax rate schedule, of the additional $10,000 of taxable income, $9,000 is taxed at 12% (the increase $29,700 to $38,700) and the remaining $1,000 ($39,700 minus $38,700) is taxed at 22%. To summarize, ($9,000 × 12%) + ($1,000 × 22%) = $1,300.

Miley, a Single Taxpayer, Plans on Reporting $29,700 of Taxable