Respuesta :
Liam's total taxes due is $22821.48.
His marginal tax rate is 24%.
His effective tax rate is 21.000%
Hownl to calculate the tax?
If Liam is single and he earns 120000 annually, the total tax due on his annual gross income is:
= $14,751 + ( 24% of the excess over $86,373)
= $14751 + (0.24 × $(120000 - 86373)
= $14751 + (0.24 × $33627)
= $14751 + $8070.48
= $22821.48
The marginal tax rate is the highest bracket that your taxable income can fall in.
Assuming Liam is single,
Liam marginal tax rate = 24%
Effective tax rate = (total tax rate/taxable income) × 100%
where;
Taxable income = gross income - standard deduction
Effective tax rate = $22821.48/($120000 -$12,950) × 100%
Effective tax rate = 21.32%
Effective tax rate = 21.000%
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