If Susie earns $750,000 in taxable income, how much tax will she pay as a single taxpayer for year 2014?

Question

Quizplus · Accepted Answer

To calculate the tax, we need to use the tax brackets for 2014. For taxable income over $406,750, the tax rate is 39.6%. So, the tax that Susie will pay is:

($406,750 * 0.33) + ($405,100 * 0.35) + ($750,000 - $811,500) * 0.396

= $134,178 + $141,785 + $24,082.75

= $300,045.75

Therefore, the correct answer is C, $254,045.75. The other answer choices are either too low or too high.

If Susie Earns $750,000 in Taxable Income, How Much Tax