Personal Finance (MindTap Course List)
13th Edition
ISBN: 9781337099752
Author: E. Thomas Garman, Raymond Forgue
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 4.1, Problem 3CC
Explain why some taxpayers have an effective marginal tax rate as high as 40 percent.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The best tax incentives that can significantly reduce its tax liability after finish claiming Investment Tax Allowance. State your reason.
Which of the following statements is NOT true?
A) A progressive tax system should increase the incentive for people to take low paid jobs.
B) With a progressive tax system, the more a person earns, the higher the average rate of tax will be.
C) A progressive tax is a type of tax that is assessed regardless of income.
D) A progressive tax takes a higher percentage of tax from people with higher incomes.
Explain this statement: Our tax rates are progressive.
Chapter 4 Solutions
Personal Finance (MindTap Course List)
Ch. 4.1 - Prob. 1CCCh. 4.1 - Prob. 2CCCh. 4.1 - Explain why some taxpayers have an effective...Ch. 4.2 - Prob. 1CCCh. 4.2 - Prob. 2CCCh. 4.2 - Prob. 3CCCh. 4.2 - Prob. 4CCCh. 4.2 - Prob. 5CCCh. 4.2 - Prob. 6CCCh. 4.2 - Prob. 7CC
Ch. 4.3 - Distinguish between two major types of...Ch. 4.3 - Prob. 2CCCh. 4.3 - Prob. 3CCCh. 4.3 - Prob. 4CCCh. 4 - Calculate Tax Liability. What would be the tax...Ch. 4 - Prob. 2DTMCh. 4 - Determine Tax Liability. Find the tax Liabilities...Ch. 4 - Use Tax Rate Schedule. Jared Goff, of Los Angeles,...Ch. 4 - Use Tax Rate Schedule. Carson Wentz, of...Ch. 4 - Review Figure 4-1 on page 117 and comment on the...Ch. 4 - The Johnsons Calculate Their Income Taxes Several...Ch. 4 - Prob. 2FPCCh. 4 - Prob. 3FPCCh. 4 - Prob. 4FPCCh. 4 - Taxable Versus Tax-Exempt Bonds Paxton Lynch,...Ch. 4 - Prob. 6FPCCh. 4 - Prob. 3BYOPFM
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- . What is the 'low income tax offset' (LITO)? What is the maximum LITO amount payable toeligible taxpayers? PLEASE PUT 3 REFERENCESarrow_forwardCompare the bases of the Hall-Rabushka flat tax, a broad-based general sales tax, and a consumption-based VAT.arrow_forwardWhich statement is NOT true about the structure of the Earned Income Tax Credit (EITC)? A. EITC payments decrease as earnings increase, but everyone qualifies for some amount. B. At a particular range of income, government reduces EITC payments based on a certain fixed percent of income earned. C. EITC pays a fixed amount at a range of income. D. Up to a threshold, EITC pays a certain fixed percent of wage earned.arrow_forward
- Evaluate the three strategies reducing income, increasing deductions, and taking advantage of tax credits that you listed based on their overall effect on a person's tax situation (the amount of income taxes that the person will have to pay). Evaluate the ethical issues related to the payment of income taxes. in other words, if there is a legal tax-saving strategy available to a person who earns $50,000 per year, will it be ethical for the person to utilize this strategy in order to pay less tax? State how your answer to the previous question would change if the person were making $1,500,000.arrow_forwardGiven the following tax structure, what minimum tax would need to be assessed on Shameika to make the tax progressive with respect to average tax rates?arrow_forwardK Explain how a deduction, such as the mortgage interest tax deduction, can save you money. Why do deductions benefit people in different tax brackets differently? Choose the correct answer below. OA. A tax deduction saves money by decreasing the tax bill directly. The amount saved is proportional to the tax bracket marginal rate. OB. A tax deduction saves money by decreasing the taxable income. The amount saved is proportional to the tax bracket marginal rate. OC. A tax deduction saves money by decreasing the tax bill directly. The amount saved is limited by the tax bracket marginal rate. OD. A tax deduction saves money by decreasing the taxable income. The amount saved is limited by the tax bracket marginal rate.arrow_forward
- How did you get $12,974.50 for the Marginal tax rate part?arrow_forwardWhat are the taxes and tax rates for individual taxpayers? Hope you can help me, thank youarrow_forwardChase Cutter has a marginal tax rate of 33 percent, a state income tax rate of 3.5 percent, and a city income tax rate of 0.5 percent. The tax for Social Security and Medicare is 7.65 percent. What would be the effective marginal tax rate on your last dollar of earnings?arrow_forward
- Suppose a tax is such that an individual with an income of $10,000 pays $2000 of tax, a person with an income of $20,000 pays $3000 of tax, a person with an income of $30,000 pays $4000 of tax, and so forth. What is each person’s average tax rate? Is this tax regressive, proportional, or progressive?arrow_forwardAssume that the United States Congress passes a tax law that provides for a "rebate" to taxpayers. One of the goals of the rebate is A. Increase consumer disposable income and expand the economy. B. Increase consumer disposable income and contract the economy. C. Decrease consumer disposable income and expand the economy D. Decrease consumer disposable income and contract the economy.arrow_forwardWhich is true regarding the taxation of social security benefits? Having earned income will reduce the tax on benefits RMD's are not considered when calculating any possible taxes owed Benefits are taxed at a rate of 100% Benefits could be taxed at a rate of either 50% or 85%arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
The Basics of Tax Preparation; Author: Roosevelt University;https://www.youtube.com/watch?v=EJpTwf9b82M;License: Standard Youtube License