Marc, a single taxpayer, earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham bonds.Using the U.S.tax rate schedule for 2019, how much federal tax will he owe? (Round your final answer to the nearest whole dollar.)(Use tax rate schedule.)
A)$13,200
B)$9,059
C)$7,638
D)$6,812
E)None of the choices are correct

Question

Quizplus · Accepted Answer

First, we need to find Marc's taxable income: 
Taxable income = $60,000 (salary) + $5,000 (interest income) = $65,000

Next, we need to use the U.S. tax rate schedule for 2019 to calculate his tax liability. 
The tax rate schedule for single taxpayers in 2019 is:

- 10% on taxable income from $0 to $9,700 
- 12% on taxable income from $9,701 to $39,475 
- 22% on taxable income from $39,476 to $84,200 
- 24% on taxable income from $84,201 to $160,725 
- 32% on taxable income from $160,726 to $204,100 
- 35% on taxable income from $204,101 to $510,300 
- 37% on taxable income over $510,300

To calculate Marc's federal tax liability:

- The first $9,700 of his taxable income is taxed at 10%: $9,700 x 0.10 = $970.00 
- The next $29,775 of his taxable income is taxed at 12%: $29,775 x 0.12 = $3,573.00 
- The remaining $25,525 of his taxable income is taxed at 22%: $25,525 x 0.22 = $5,615.50

Therefore, Marc's total federal tax liability is: $970 + $3,573 + $5,615.50 = $9,158.50

Rounding to the nearest whole dollar, he will owe $9,059 in federal tax.

Marc, a Single Taxpayer, Earns $60,000 in Taxable Income and $5,000