If your taxable income rises from $35,000 to $45,000,and the taxes you pay rise from $12,000 to $15,000,your marginal tax rate is

Question

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Marginal tax rate is the tax rate that applies to the last dollar of taxable income earned.

In this case, the increase in taxable income is $10,000 ($45,000 - $35,000), and the increase in taxes paid is $3,000 ($15,000 - $12,000).

Therefore, the marginal tax rate would be:

$3,000 ÷ $10,000 = 0.3 or 30%

If Your Taxable Income Rises from $35,000 to $45,000,and the Taxes