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What is the amount of the tax liability for a married couple with taxable income of...

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linnie4352 | Student, Undergraduate | (Level 1) Salutatorian

Posted April 11, 2011 at 1:38 AM via web

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What is the amount of the tax liability for a married couple with taxable income of $135,500?

A. $20,325
B. $26,238
C. $33,875
D. $19,488

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justaguide | College Teacher | (Level 2) Distinguished Educator

Posted April 11, 2011 at 2:22 AM (Answer #1)

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For married individuals if the marginal tax rates and the appropriate income brackets for the year 2010 are used, the income of the couple can be divided into the following:

  • $16750 taxed at 10% implies a tax of $1675
  • $51250 taxed at 15% implies a tax of $7687.5
  • $67500 taxed at 25% implies a tax of $16875

The sum of the three values calculated is $1675 + $7687.5 + $16875 = $26237.5

Rounding $26237.5 gives $26238.

The correct answer for the amount of tax liability for the married couple on an income of $135500 is option B or $26238.

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