To calculate the federal income tax owed on a \[tex]$60,000 salary using the progressive tax rates provided, follow these steps:
1. Determine the taxable income:
- First, we need to subtract the standard deduction from the salary.
- \(\text{Taxable Income} = \$[/tex]60,000 - \[tex]$12,200 = \$[/tex]47,800\).
2. Calculate the tax owed by applying the tax rates to the relevant portions of the taxable income:
- First bracket:
- Income Range: \[tex]$0 - \$[/tex]9,700
- Rate: 10%
- Calculation: [tex]\(\$9,700 \times 0.10 = \$970\)[/tex]
- Second bracket:
- Income Range: \[tex]$9,701 - \$[/tex]39,475
- Rate: 12%
- Calculation: [tex]\((\$39,475 - \$9,700) \times 0.12 = \$29,775 \times 0.12 = \$3,573\)[/tex]
- Third bracket:
- Income Range: \[tex]$39,476 - \$[/tex]84,200
- Rate: 22%
- For the third bracket, we only need to calculate the tax on the income up to the taxable income limit of \[tex]$47,800.
- Calculation: \((\$[/tex]47,800 - \[tex]$39,475) \times 0.22 = \$[/tex]8,325 \times 0.22 = \[tex]$1,833.50\)
3. Sum up the tax calculated for each bracket:
- \(\text{Total Tax Owed} = \$[/tex]970 + \[tex]$3,573 + \$[/tex]1,833.50 = \[tex]$6,374.50\)
So, the federal income tax owed on a \$[/tex]60,000 salary is \[tex]$6,374.50.
This thorough step-by-step calculation leads us to the result that the taxable income is \$[/tex]47,800 and the federal income tax owed is \$6,374.50.
