Tammy made $30,000 in taxable income last year.Suppose the income tax rate is 10% for the first $8500 plus 14% for the amount over $8500.How much must Tammy pay in income tax for last year?
Question
Tammy made 8500 plus 14% for the amount over $8500.How much must Tammy pay in income tax for last year?
Solution
To calculate Tammy's income tax, we need to break down her income into two parts: the first 8500.
Step 1: Calculate the tax for the first 8500 is 10%. So, we calculate 10% of 8500 = $850
Step 2: Calculate the tax for the amount over 30,000 last year. So, the amount over 30,000 - 21,500. The tax rate for the amount over 21,500. 0.14 * 3010
Step 3: Add the tax from step 1 and step 2 together 3010 = $3860
So, Tammy must pay $3860 in income tax for last year.
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