# Estimated Taxes and Marginal Tax Rate

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We have new tax rules for 2018. For this lesson, use the information I've given you in the opening scenario, the new rules will be used for taxes filed in 2019 for the tax year 2018. The difference for actual taxes is the deductions and exemption rules. This lesson is not applying the new rules as taxes this spring for 2017 will use the old rules. See attached file for more details.

1/16/2018 IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts And More Tax Brackets. The big news is, of course, the tax brackets and tax rates for 2017: Individual Taxpayers If Taxable Income Is Between: Th 0 - \$9,325 10% of taxable income \$9,326- \$37.,950 \$932.50 + 1 5°/o of t e amount over \$9,325 \$37,951 - \$91 ,900 S5,226.25 + 2 % of the amount over \$37,950 \$91,901 - \$191,650 \$18,713.75 + 28% of the amount ver\$91,900 \$191 ,651 -\$416,700 \$4 6.643. 75 + 33% of the amount over S 191.650 \$416.701 -\$418,400 51 2 ,910. 5 + 35% ottheamoun over\$416,700 \$4 8,4 01 + \$121.505.25 + 39.6% of the amount over \$418,400 Married Individuals Filing Joint Returns and Surviving Spouses ..------The Tax Due Is: 0 - \$18,650 0 Yo o ta xable income \$18,651 - \$75,900 \$1,865 + 15%,of t ea omtove 518,650 \$75,901 - \$153.100 \$10.4 52.50 + 25% of the amount o1er \$75.900 \$153,101 - \$2 3 50 \$/ .75/.50 + 28% flho ' \$233,351- 5416,700 \$52, 222.50 + 33% of the a ount over \$233,350 \$4 16.701 - \$470.700 \$1 2.728 + 35% o the rno nt ov r \$416.700 \$470,701 + \$1 1, 28+ 39.6% of heam unt over \$470,700 unt ov r \$15 ,100 https://www.forbes.com/sites/kellyphillipserb/2016/10/25/irs-announces-2017-tax-rates-standard-deductions-exemption-amounts-and-more/#498a82c2... 1/3 1/16/2018 IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts And More Heads of Household The Tax Due I ·: 10 l'o o ta x ble inco te 0 - 13,3o0 \$13,351 \$50 800 S50, 80 - \$131.2 0 \$6.9 2.r.o + 25% of th am unt \$131,201 - \$212.500 \$27 ,052.50 + 28 y; f th· \$21 2. 501 - \$416.t 0 S4 ,81 .50 + 33% \$41 . 701 - \$444 .550 \$117.202.50 + 35% \$444. 551 + f th S1 26.950 + 39.6% f t h fl OUI \$50. 00 t OV r \$131 200 o nt v r \$212. 00 r \$416, 700 moun er \$444, ,..c;; Married Filing Separately so- \$9,325 10 Vo of taxr.ble income \$9,326 - \$37.950 \$932.50 + 15 Vo of the amount over \$9.325 \$37,951 - \$76.550 \$5,226.25 + 25% o f t he amount over \$37,950 \$76.551- \$116.675 S 14. 876.25 + 28 Yo of t 1e amount over \$76.550 \$116.676 - \$208,350 \$26,111.25 + 33% of the nmount over \$116.675 \$208,351 - \$235, 350 \$56.364 + 35 Yo of he amour t over \$208,350 \$235,351 + \$65,81 4 39.6% of the amount over \$235,350 You can compare these numbers against the 2016 brackets here. The standard deduction for single taxpayers and married couples filing separately is \$6,350 in 2017, up from \$6,300 in 2016; for married couples filing jointly, the standard deduction is \$12,700, lip \$100 from the prior year; and for heads of households, the standard deduction is \$9,350 for 2017, up from \$9,300. The numbers look like this: https://www. forbes.com/sites/kellyphillipserb/2016/10/25/irs-announces-2017-tax-rates-standard-deductions-exemption-amounts-and-more/#498a82c2... 2/3 1/16/2018 IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts And More Filing Status Standard Deduction Amount Single \$6,350 Mr1 ried Filing Jointly & Surviving Spow;e 512,700 tv mried Filing Separa J , \$6,350 Head of Household \$9,350 https://wwwo forbesocom/sites/kellyphillipserb/2016/10/25/irs-announces-2017-tax-rates-standard-deductions-exemption-amounts-and-more/#498a82c2 0 0 0 3/3

Prof.Voigt
School: University of Maryland

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The attached word document contains the answer to “Estimated Taxes and Marginal Tax Rate”

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Estimated Taxes and Marginal Tax Rate
1. Total reportable gross income:
Reportable gross income= wages + savings interest+ Alimony from ex-husband+ Childsupport payments
= \$(42,000+40,000+140+4380+14200) = \$100720
2. Adjusted gross income after putting \$5600 into qualified retirement plan accounts
Gross income= wages + savings interest+ Alimony from ex-husband+ Child-support
payments+ Retirement plan distribution
= \$100720+\$5600
= \$106320
3. Personal exemptions claim for Sandler family.
a. The Sandler family will claim 4 exemptions
b.

The total value of the exemptions for Sandler family is (\$4050*4) = \$16,200

4. The allowable standard deduction for the household i...

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