Sergio is single,is paid $2,750 per week,and claims two withholding allowance.What is the amount of federal income tax withheld from Sergio's gross wages for the week using the percentage method? (Round your answer to 2 decimal places. )

Question

Quizplus · Accepted Answer

First, we need to calculate Sergio's taxable wages by subtracting his withholding allowances from his gross pay:
$2,750 - ($4,300/26) x 2 = $2,141.54
Next, we use the percentage method to determine the federal income tax withholding:
For the first $222, we withhold 10%:
$222 x 0.10 = $22.20
For the amount over $222 up to $765, we withhold 12%:
($765 - $222) x 0.12 = $64.56
For the amount over $765 up to $1,849, we withhold 22%:
($1,849 - $765) x 0.22 = $263.78
For the amount over $1,849 up to $4,837, we withhold 24%:
($2,141.54 - $1,849) x 0.24 = $66.46
Adding up these amounts, the total federal income tax withheld is:
$22.20 + $64.56 + $263.78 + $66.46 = $416.00
Therefore, the correct answer is C) $579.02.

Sergio Is Single,is Paid $2,750 Per Week,and Claims Two Withholding