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31 December, 04:45

Suppose the tax rate is 0 on the first $20,000, 20 percent on the next $20,000, 30 percent on the next $20,000, 40 percent on the next $20,000, and 50 percent on all income over that. The Valenzuela family has an income of $80,000. What is the tax bill for this family?

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  1. 31 December, 05:04
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    income tax expense 18,000

    Explanation:

    we have to calcualte the taxable income on each bracket:

    1st 20,000 tax free

    $20001 to $40,000 are taxes at 20% Thus, 4,000 income tax

    $40,001 to $60,000 are taxes at 30% Thus, 6,000 income tax

    $60,001 to $80,000 are taxes at 40% Thus, 8,000 income tax

    In total the income tax will be for $18,000
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