3 15 16 199 Using Excel to find the marginal tax rate can be accomplished using the VLOOKUP function. However, calculating the total tax bill is a little more difficult. Below we have shown a copy of the IRS tax table for an unmarried individual for 2023. Often, tax tables are presented in this format. If taxable income is But not 45 6789 over- over- $0 $11,000 11,000 44,725 44,475 10 11 12 13 95,375 182,100 231,250 578,125 95,375 182,100 231,250 578,125 14 The tax is: 10% of the amount over $0 $1,100 plus 12% of the amount over $11,000 $5,147 plus 22% of the amount over $44,725 $16,290 plus 24% of the amount over $95,375 $37,104 plus 32% of the amount over $182,100 $52,832 plus 35% of the amount over $231,250 $174,238.25 plus 37% of the amount over $578,125 In reading this table, the marginal tax rate for taxable income less than $11,000 is 10 percent. If the taxable income is between $11,000 and $44,725, the tax bill is $1,100 plus the marginal taxes. The marginal taxes are calculated as the taxable income minus $11,000 times the marginal tax rate of 12 percent. 1 2 3 Master it! Solution 4 a. 5 6 7 + 8 9 10 17 Below, we have the tax table that was applicable for married individuals filing jointly in 2023. 18 11 If taxable income is But not over -- over - The tax is: of the amount over plus of the amount over plus of the amount over plus of the amount over plus of the amount over plus of the amount over plus of the amount over 19 Taxable income $ 225,000 20 12 Taxable 13 b. The marginal tax rate is income is But 14 21 greater than or equal to less than or 15 C. The total tax bill is equal to... Tax rate 22 $ $ 22,000 10% 16 23 22,000 89,450 12% 17 24 89,450 190,750 22% 25 190,750 364,200 24% 18 Tax on the bottom of marginal tax bracket Amount of income in marginal tax bracket 26 364,200 462,500 32% 19 Total tax 27 462,500 693,750 28 693,750 35% 37% 20 29 21 d. a. 30 Create a tax table in Excel for a couple filing jointly similar to the individual tax table shown above. Your spreadsheet should then calculate the marginal tax rate, the average tax rate, and the tax bill for any level of taxable income input by a user. The average tax rate is 0.000% 22 31 23 32 b. For a taxable income of $245,000, what is the marginal tax rate? 33 24 34 c For a taxable income of $245,000, what is the total tax bill? 25 35 36 d. For a taxable income of $245,000, what is the average tax rate? 26 37 38 27 39 28 40 41 29 42