Chuck, a single taxpayer, earns $137,750 in taxable income and $15,500 in interest from an...


Chuck, a single taxpayer, earns $137,750 in taxable income and $15,500 in interest from an investment in City of Heflin bonds. (Use the U.S. tax rate schedule.) (Do not round intermediate calculations. Round your answers to 2 decimal places.)


a. If Chuck earns an additional $51,500 of taxable income, what is his marginal tax rate on this income?

Marginal Tax Rate ........................ %

b. What is his marginal rate if, instead, he had $51,500 of additional deductions?

Marginal Tax Rate .......................... %

Definition of taxable income.

Taxable income is also known as gross income. Taxable income is the amount of money paid by an individual or an organization to the government in a particular period of time. The amounts included in the taxable income vary by country or the system used.

Answer and Explanation: 1

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The US tax schedule for the year 2016 is considered.

$ 15,500 in the interest from the investment in the City of Heflin bonds is non-taxable.


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What is a Marginal Tax Rate? - Definition & History


Chapter 24 / Lesson 8

Learn about the history and concept of marginal tax rates in the United States, including how to calculate marginal income tax rates using formulas and examples.

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