Answer
Income of 20,000 dollars:
State income tax of 800 dollars
Federal payroll tax of 3,060 dollars
Federal income tax of 2,553.75 dollars
Average tax rate of 32.07%
Marginal tax rate of 34.3%
Income of 40,000 dollars:
State income tax of 1,600 dollars
Federal payroll tax of 6,120 dollars
Federal income tax of 5,928.75 dollars
Average tax rate of 29.12%
Marginal tax rate of 44.3%
Work Step by Step
20,000 dollars:
$20000*.04=800$
$20000*.153=3060$
$(20000-8925)*.15+(8925)*.1$
$11075*.15+892.50$
$1661.25+892.5$
$2553.75$
$800+3060+2553.75$
$3860+2553.75$
$6413.75$
$6413.75/20000=32.07$ percent
$.04+.153+.15$
$.303+.04$
$.343$
40,000 dollars
$40000*.04=1600$
$40000*.153=4120$
$(40000-36250)*.25+(36250-8925)*.15+(8925)*.1$
$3750*.25+27325*.15+892.5$
$937.5+4098.75+892.5$
$5928.75$
$1600+4120+5928.75$
$11648.75$
$11648.75/40000=29.12$ percent
$.04+.153+.25$
$.193+.25$
$.443$
