Carter was recently hired for a job with an annual income of $34,000. Using the federal income rate of 15%, what amount should Carter expect to pay in federal income tax?

Answer 1

To calculate the federal income tax that Carter should expect to pay, we first need to determine his taxable income.

Since Carter's annual income is $34,000, we subtract the standard deduction for a single filer for the tax year 2021, which is $12,550.

$34,000 - $12,550 = $21,450

Next, we determine the tax rate for Carter's income level. For a taxable income of $21,450, the tax rate is 12% on the first $9,950 and 22% on the remaining balance.

Tax on the first $9,950: $9,950 * 0.12 = $1,194
Tax on the remaining $11,500 ($21,450 - $9,950): $11,500 * 0.22 = $2,530

Total federal income tax: $1,194 + $2,530 = $3,724

Therefore, Carter should expect to pay $3,724 in federal income tax.