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Use the spreadsheet federalindividualratehistory.xlsx to answer the questions. It contains a complete history of income tax brackets and rates from the inception of the income tax in 1913 through 2013, in both dollars current in each year and adjusted for inflation (2012 dollars) a) compute the tax due in 2003 for a single taxpayer with a net taxable income of $30k. what is her effective tax rate? b) suppose the taxpayer received raises each year that kept up with inflation. use an inflation calculator to calculate her net taxable income in 2013.

Use the spreadsheet federalindividualratehistory.xlsx to answer the questions. It contains a complete history of income tax brackets and rates from the inception of the income tax in 1913 through 2013, in both dollars current in each year and adjusted for inflation (2012 dollars) a) compute the tax due in 2003 for a single taxpayer with a net taxable income of $30k. what is her effective tax rate? b) suppose the taxpayer received raises each year that kept up with inflation. use an inflation calculator to calculate her net taxable income in 2013.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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7.8.26 a),b)

Use the spreadsheet federalindividualratehistory.xlsx to answer the questions. It contains a complete history of income tax brackets and rates from the inception of the income tax in 1913 through 2013, in both dollars current in each year and adjusted for inflation (2012 dollars)

a) compute the tax due in 2003 for a single taxpayer with a net taxable income of $30k. what is her effective tax rate?

b) suppose the taxpayer received raises each year that kept up with inflation. use an inflation calculator to calculate her net taxable income in 2013.

Federalindividualratehistory.xlsx 1913-2013 CPI CPI Data http://taxfoundation.org/article/us-federal-individual-income-tax-rates-history-1913-20 resented in nominal dollar amounts. 2013 Single Head of Household Marginal Tax Brackets Marginal Tax Brackets ot Over Tax Rate Over But Not Over Tax Rate Over But Not Over $8,925 10.0% $0 $8,925 10.0% $0 $12,750 36,250 15.0% $8,925 $36,250 15.0% $12,750 $48,600 73,200 11,525 99,175 25.0% $36,250 $87,850 25.0% $48,600 $125,450 28.0% $87,850 $183,250 28.0% $125,450 $203,150 33.0% $183,250 $398,350 33.0% $203,150 $398,350 25,000 35.0% $398,350 $400,000 35.0% $398,350 $425,000 39.6% $400,000 39.6% $425,000
Transcribed Image Text:Federalindividualratehistory.xlsx 1913-2013 CPI CPI Data http://taxfoundation.org/article/us-federal-individual-income-tax-rates-history-1913-20 resented in nominal dollar amounts. 2013 Single Head of Household Marginal Tax Brackets Marginal Tax Brackets ot Over Tax Rate Over But Not Over Tax Rate Over But Not Over $8,925 10.0% $0 $8,925 10.0% $0 $12,750 36,250 15.0% $8,925 $36,250 15.0% $12,750 $48,600 73,200 11,525 99,175 25.0% $36,250 $87,850 25.0% $48,600 $125,450 28.0% $87,850 $183,250 28.0% $125,450 $203,150 33.0% $183,250 $398,350 33.0% $203,150 $398,350 25,000 35.0% $398,350 $400,000 35.0% $398,350 $425,000 39.6% $400,000 39.6% $425,000
Federalindividualratehistory.xlsx 1913-2013 CPI Data 39,325 28.0% $70,350 $146,750 28.0% $100,500 $162,700 59,550 33.0% $146,750 $319,100 33.0% $162,700 $319,100 35.0% $319,100 35.0% $319,500 2003 Single Head of Household Marginal Tax Brackets Marginal Tax Brackets ot Over Tax Rate Over But Not Over Tax Rate Over But Not Over -7,000 3,725 -7,325 -7,350 -5,975 10.0% $0 $7,000 10.0% $0 $10,000 15.0% $7,000 $28,400 15.0% $10,000 $38,050 25.0% $28,400 $68,800 25.0% $38,050 $98,250 28.0% $68,800 $143,500 28.0% $98,250 $159,100 33.0% $143,500 $311,950 33.0% $159,100 $311,950 35.0% $311,950 35.0% $311,950
Transcribed Image Text:Federalindividualratehistory.xlsx 1913-2013 CPI Data 39,325 28.0% $70,350 $146,750 28.0% $100,500 $162,700 59,550 33.0% $146,750 $319,100 33.0% $162,700 $319,100 35.0% $319,100 35.0% $319,500 2003 Single Head of Household Marginal Tax Brackets Marginal Tax Brackets ot Over Tax Rate Over But Not Over Tax Rate Over But Not Over -7,000 3,725 -7,325 -7,350 -5,975 10.0% $0 $7,000 10.0% $0 $10,000 15.0% $7,000 $28,400 15.0% $10,000 $38,050 25.0% $28,400 $68,800 25.0% $38,050 $98,250 28.0% $68,800 $143,500 28.0% $98,250 $159,100 33.0% $143,500 $311,950 33.0% $159,100 $311,950 35.0% $311,950 35.0% $311,950
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