Miley, a single taxpayer, plans on reporting $28,650 of taxable income this year (all of her income is from a part-time job). She is considering applying for a second part-time job that would give her an additional $10,000 of taxable income. By how much will the income from the second job increase her tax liability? (use the tax rate schedules)

Question

Quizplus · Accepted Answer

Based on the single tax rate schedule, of the additional $10,000 of taxable income, $9,000 is taxed at 15% (the increase $28,650 to $37,650) and the remaining $1,000 ($38,650 minus $37,650) is taxed at 25%. To summarize, ($9,000 × 15%) + ($1,000 × 25%) = $1,600.

Miley, a Single Taxpayer, Plans on Reporting $28,650 of Taxable