Assume tax rates on single individuals are 10% on taxable income up to $9,275, 15% on income of $9,276 to $37,650 and 25% on income of $37,651 to $91,150. what is the tax liability for a single individual with $52,000 of taxable income, which includes $2,000 of dividends?

total  tax liability = $8771.25

Explanation:

given data

taxable income up to $9,275 single individuals = 10 %  

income of $9,276 to $37,650 = 15 %

income of $37,651 to $91,150 = 25 %

solution

we know here  amount upto  $9,275 is

amount upto  $9,275 =  $9,275 × 10% = $927.50     1

and

amount  $9,276 to $37,650 = ( 37650 - 9276 ) × 15%  = $4257.45     2

and

amount $37,650 to $50,000 = ( 50000 - 37650) × 25% = $3587.50     3

so now add all 3 equation we get

total  tax liability = $927.5 + $4256.25 + $3587.5

total  tax liability = $8771.25

Tax Bracketrateamount

upto$          9,27510%$     927.50

next (37650-9275)$        28,37515%$ 4,256.25

remaining$        14,35025%$ 3,587.50

total$        52,000  $ 8,771.25