To calculate the federal income tax owed on a \$62,900 salary using the provided progressive tax rates and standard deduction, follow these steps:
1. Determine the taxable income:
The salary is \[tex]$62,900, and the standard deduction is \$[/tex]12,000. Subtract the standard deduction from the salary to find the taxable income.
[tex]\[
\text{Taxable Income} = \[tex]$62,900 - \$[/tex]12,000 = \$50,900
\][/tex]
2. Break the taxable income into the defined income ranges and apply the corresponding tax rates:
- The first income range is \[tex]$0 to \$[/tex]9,700, taxed at 10%.
- The second income range is \[tex]$9,701 to \$[/tex]39,475, taxed at 20%.
- The third income range is \[tex]$39,476 to \$[/tex]84,200, taxed at 22%.
- Higher ranges are not applicable as the taxable income is \$50,900.
3. Calculate the tax for each applicable range:
- For the first range (\[tex]$0 to \$[/tex]9,700):
[tex]\[
\text{Tax for first range} = \[tex]$9,700 \times 0.10 = \$[/tex]970
\][/tex]
- For the second range (\[tex]$9,701 to \$[/tex]39,475):
[tex]\[
\text{Taxable portion in this range} = \[tex]$39,475 - \$[/tex]9,700 = \$29,775
\][/tex]
[tex]\[
\text{Tax for second range} = \[tex]$29,775 \times 0.20 = \$[/tex]5,955
\][/tex]
- For the third range (\[tex]$39,476 to \$[/tex]50,900):
[tex]\[
\text{Taxable portion in this range} = \[tex]$50,900 - \$[/tex]39,475 = \$11,425
\][/tex]
[tex]\[
\text{Tax for third range} = \[tex]$11,425 \times 0.22 = \$[/tex]2,513.50
\][/tex]
4. Sum the taxes from each range to find the total tax:
[tex]\[
\text{Total Tax} = \[tex]$970 + \$[/tex]5,955 + \[tex]$2,513.50 = \$[/tex]9,438.50
\][/tex]
Thus, the federal income tax owed on a \[tex]$62,900 salary, after the standard deduction, is \$[/tex]9,438.50.
