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What is the familys marginal tax rate

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Reference no: EM131972160

The Lowell family tells you the following regarding their financial situation for 2015:  Their gross salary is $95,000.  They paid real estate taxes of $8,000 and interest on their mortgage of $6,000.

They earned $1,500 in interest from a Cortland County highway bond. They made $6,000 on the sale of 5 acres that they had owned for 2 years. 

 They also made $2,000 on the sale of Sun Edison stock they owned for 9 months. The couple has one child. Exemptions are $3,800/person.

a. WHAT IS THEIR TAXABLE INCOME?  SHOW YOUR WORK STEP BY STEP.

b.Use the table below to determine their tax liability:  SHOW YOUR WORK.

Taxable Income Tax Rate
Up to $25,000 10%
$25,000 -$40,000 15%
$40,000 - $55,000 20%
$55,000-$70,000 25%
over $70,000 35%

c. What is the family's marginal tax rate?

d. What is the family's average rate?  Show your calculation.

Reference no: EM131972160

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