Jackson was recently hired for a job with an annual income of $26,000. Using the federal income rate of 15%, what amount should Jackson expect to pay in federal income tax?

Answer 1

To calculate the amount of federal income tax Jackson should expect to pay, we first need to determine his taxable income.

Since his annual income is $26,000, we will subtract the standard deduction from this amount. For 2021, the standard deduction for a single individual is $12,550.

Taxable Income = Annual Income - Standard Deduction
Taxable Income = $26,000 - $12,550
Taxable Income = $13,450

Now that we have Jackson's taxable income, we can calculate the amount of federal income tax he will owe using the 15% tax bracket.

Federal Income Tax = Taxable Income x Tax Rate
Federal Income Tax = $13,450 x 0.15
Federal Income Tax = $2,017.50

Therefore, Jackson should expect to pay $2,017.50 in federal income tax.