Is this statement true true about underpayment penalties? 1. These penalties may be assed when the taxed withheld or paid during the current taxed year was less than 90% of the tax year for the current year or 100% of the tax shown on the return for the prior year whichever is smaller andd the tax owed is at least $1,000.

Is this statement true about underpayment penalties may be assessed when the tax withheld or paid during the current tax year was less than 90% of the tax for the current year or 100% of the tax shown on the return for the prior year whichever is smaller and the tax owed is at least $1,000.

If a T1 or T2 return is filed late, certain charges apply. Which of the following statements is INCORRECT? O a. a. Penalties and interest are based on the balance of tax payable at the taxation year-end. O b. For the first offence, penalties are charged at a rate equal to 5%, plus 1% for each complete month that the tax due is outstanding. O c. For the second offence, penalties are charged at a rate equal to 10%, plus 2% for each complete month that the tax due is outstanding. O d. Interest is calculated at a prescribed interest rate, set by Canada Revenue Agency. O e. Late-filing penalties are charged but there are no interest charges.

Suppose that the income tax law exempts income of less than $8000 from the tax, taxes income between $8000 and $20,000 at a 25% rate, and taxes income greater than $20,000 at a 30% rate. Find the average tax rate and the marginal tax rate for someone earning $16,000 and for someone earning $30,000. The tax law is change so that income of less than $6000 is untaxed, income from $6000 to $20,000 is taxed at 20%,