Answer:
Jorge and Anita will owe $30,069.50 in federal income tax this year computed as follows:
$30,069.50 = $27,087.50 + 28 % ($150,000 − $139,350).
Jorge and Anita’s average tax rate is 20.05 percent.
Average Tax Rate = Total Tax/Taxable Income
Average Tax Rate = $30,069.50 / $150,000 = 20.05%
Jorge and Anita’s effective tax rate is 15.83 percent.
Effective tax rate = Total Tax / Total Income
Effective tax rate = $30069.50 / ($150,000 + $40,000) = 15.83%
Jorge and Anita are currently in the 28 percent tax rate bracket. Their marginal tax rate on increases in income up to $62,300 and deductions up to $10,650 is 28 percent
