For federal income tax purposes, a taxpayer's marginal tax rate is

Question

Quizplus · Accepted Answer

The marginal tax rate is the tax percentage you pay on your next dollar of income. It is the tax rate applied to the last dollar of taxable income earned by the taxpayer. It is based on the taxpayer's highest tax bracket, which is determined by their taxable income. Therefore, option B, "the rate applied to income in the taxpayer's highest tax bracket," is the correct answer.

For Federal Income Tax Purposes, a Taxpayer's Marginal Tax Rate