Question 1 (20 points) The following table is from the Georgia Income Tax table

Question

Question 1 (20 points) The following table is from the Georgia Income Tax table for married persons filing jointly. If the amount on line 15, Form 500 is. Not over $750 Over $ 750 but not over $2,250 Over $2,250 but not over $3,750 Over $3,750 but not over $5,250 Over $5,250 but not over S7,000 Over $7,000.. Amount of Tax is: 1% of Taxable income $ 7.50 plus 2% of amount over s 37.50 plus 3% of amount over $ 82.50 plus 4% of amount over $142.50 plus 5% of amount over $230.00 $ 750 $2,250 $3,750 $6,250 $7,000 plus 6% of amount over Determine the taxable income, to the nearest penny, for an individual filing jointly who pays a tax of $546.37. Do not include commas or dollar sign in your answer.

Explanation / Answer

The amount of tax paid is 546.37$
We know that this can fall in the tax bracket of 230$+
which happens for an income of over 7000$
For income over 7000$,
the amount of tax to be paid is 230$ + 6% of amount over 7000$
Let the income be 'x' $ such that x>7000
tax to be paid =
230 + 0.06 (x-7000) = 546.37
0.06 (x-7000) = 546.37-230
0.06 (x-7000) = 316.37
x-7000 = 316.37/0.06
x-7000 = 5272.83
x= 7000+ 5272.83 = 12272.83 $

Thus, the taxable income of the couple is 12272.83

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