Andrea is single and has a 2013 taxable income of $199,800 She also received $15,000 of tax-exempt income.Andrea's average tax rate is:

Question

Quizplus · Accepted Answer

To find the average tax rate, we need to calculate the total tax paid and divide it by the total taxable income, which includes both taxable and tax-exempt income. Using the 2013 tax brackets for a single individual, we can calculate Andrea's tax liability as follows:

First, we subtract the exemption and deduction:
$199,800 - $6,100 (personal exemption) - $12,200 (standard deduction) = $181,500 taxable income

Next, we determine the tax on the taxable income:
$45,466.25 (tax on the first $178,650) + 0.28($181,500 - $178,650) = $46,296.25

Finally, we calculate the total tax paid by adding the tax on taxable income and any other taxes (such as self-employment tax):
$46,296.25 + $0 = $46,296.25

To find the average tax rate, we divide the total tax paid by the total income, which includes both taxable and tax-exempt income:
($46,296.25 / ($199,800 + $15,000)) x 100% = 25.1%

Therefore, the correct answer is C, 25.1%.

Andrea Is Single and Has a 2013 Taxable Income of $199,800