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To determine how much income a person has left after paying federal income tax, we need to calculate the tax owed based on the given taxable income and appropriate tax brackets. The taxable income given is [tex]$79,950.
Here's a step-by-step breakdown:
### Tax Brackets Review
1. $[/tex]0 - [tex]$8,350: 10%
2. $[/tex]8,350 - [tex]$33,950: 15%
3. $[/tex]33,950 - [tex]$82,250: 25%
4. $[/tex]82,250 - [tex]$171,550: 28%
5. $[/tex]171,550 - [tex]$372,950: 33%
6. Over $[/tex]372,950: 35%
### Calculating Tax in Brackets
1. From [tex]$0 to $[/tex]8,350:
- Tax = [tex]$8,350 * 10% = $[/tex]835
2. From [tex]$8,350 to $[/tex]33,950:
- Amount subject to 15% tax = [tex]$33,950 - $[/tex]8,350 = [tex]$25,600 - Tax = $[/tex]25,600 * 15% = [tex]$3,840 3. From $[/tex]33,950 to the given income [tex]$79,950: - Amount subject to 25% tax = $[/tex]79,950 - [tex]$33,950 = $[/tex]46,000
- Tax = [tex]$46,000 * 25% = $[/tex]11,500
### Summing the Tax Amounts
- Total tax up to [tex]$8,350 = $[/tex]835
- Total tax from [tex]$8,350 to $[/tex]33,950 = [tex]$3,840 - Total tax from $[/tex]33,950 to [tex]$79,950 = $[/tex]11,500
Total tax = [tex]$835 + $[/tex]3,840 + [tex]$11,500 = $[/tex]16,175
### Income After Tax
- Taxable income = [tex]$79,950 - Total tax = $[/tex]16,175
Income after tax = [tex]$79,950 - $[/tex]16,175 = [tex]$63,775 ### Conclusion Therefore, after paying the federal income tax, the person has $[/tex]\[tex]$63,775.00 left over. The correct answer is: D. $[/tex]63,775.00
### Calculating Tax in Brackets
1. From [tex]$0 to $[/tex]8,350:
- Tax = [tex]$8,350 * 10% = $[/tex]835
2. From [tex]$8,350 to $[/tex]33,950:
- Amount subject to 15% tax = [tex]$33,950 - $[/tex]8,350 = [tex]$25,600 - Tax = $[/tex]25,600 * 15% = [tex]$3,840 3. From $[/tex]33,950 to the given income [tex]$79,950: - Amount subject to 25% tax = $[/tex]79,950 - [tex]$33,950 = $[/tex]46,000
- Tax = [tex]$46,000 * 25% = $[/tex]11,500
### Summing the Tax Amounts
- Total tax up to [tex]$8,350 = $[/tex]835
- Total tax from [tex]$8,350 to $[/tex]33,950 = [tex]$3,840 - Total tax from $[/tex]33,950 to [tex]$79,950 = $[/tex]11,500
Total tax = [tex]$835 + $[/tex]3,840 + [tex]$11,500 = $[/tex]16,175
### Income After Tax
- Taxable income = [tex]$79,950 - Total tax = $[/tex]16,175
Income after tax = [tex]$79,950 - $[/tex]16,175 = [tex]$63,775 ### Conclusion Therefore, after paying the federal income tax, the person has $[/tex]\[tex]$63,775.00 left over. The correct answer is: D. $[/tex]63,775.00
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