Tax- Chapter 1

On Form 1040, the amount of the standard deduction from income for taxpayers filing a joint return is:

24800

Eddie, a single taxpayer, has W-2 income of $40,841. Using the tax tables, he has determined that his tax liability is:

3412 40,841-12400= 28441 taxable income

Arno and Bridgette are married and have combined W-2 income of $72,441. They received a $538 refund after they filed their taxes. How much income tax did their employers withhold during the year? Use the tax tables.

72441-24800=47641 taxable income =5320 Tax Liability + 538 refund = 5858 amount withheld

Which of the following is an example of a progressive tax?

Federal income tax.

A tax rate that decreases as the tax base decreases is an example of what kind of tax rate structure?

Progressive

Jake earned $15,000 and paid $1,500 of income tax; Jill earned $40,000 and paid $4,000 of income tax. The tax rate structure they are subject to is:

Proportional

A tax rate that decreases as the tax base increases is an example of what kind of tax rate structure?

Regressive

Margaret earned $15,000 and paid $1,500 of income tax; Mike earned $50,000 and paid $4,000 of income tax. The tax rate structure they are subject to is:

Regressive

Which of the following is not a permitted filing status?

Single filing jointly.

Which of the following is an example of a regressive tax?

Social Security tax.

A married taxpayer who files the return jointly, has taxable income of $52,717. You have calculated tax liability using the tax tables and using the tax rate schedules. What can you say about the two figures?

Tax liability determined using the tax tables will be more than tax liability determined using the tax rate schedules.

Wage income is reported to a taxpayer on a Form:

W-2

Elizabeth determined that her tax liability was $3,942. Her employer withheld $3,492 from her paychecks during the year. Elizabeth's tax return would show:

tax due of $450.

Individual taxpayers with only wage income must file a Form:

1040

Interest income is reported to a taxpayer on a Form:

1099-int

Jennifer and Paul, who file a joint return, have taxable income of $93,575 and the following tax liability: $19,750 × 10% =$ 1,975.00($80,250 − $19,750) × 12% =7,260.00($93,575 − $80,250) × 22% =2,931.50Total tax liability$ 12,166.50 Their average tax rate is:

13% Total Amount of Tax/Total Amt of income

Sandra, a single taxpayer, has taxable income of $91,165. Using the tax tables, she has determined that her tax liability is:

15962

Jennifer and Paul, who file a joint return, have taxable income of $93,575 and the following tax liability: $19,750 × 10% =$ 1,975.00($80,250 − $19,750) × 12% =7,260.00($93,575 − $80,250) × 22% =2,931.50Total tax liability$ 12,166.50 Their marginal tax rate is:

22% Divided into tax brackets