To determine the effective tax rate for a taxable income of [tex]$75,400, we will carefully calculate the amount of tax owed at each bracket and then find the effective tax rate.
Here's a detailed step-by-step solution:
1. Calculate the tax for each bracket up to $[/tex]75,400:
- First Bracket: \[tex]$0 - \$[/tex]10,275 at 10%
[tex]\[
\text{Tax} = 10,275 \times 0.10 = 1,027.50
\][/tex]
- Second Bracket: \[tex]$10,276 - \$[/tex]41,175 at 12%
[tex]\[
\text{Tax} = (41,175 - 10,276 + 1) \times 0.12 = 30,900 \times 0.12 = 3,708.00
\][/tex]
- Third Bracket: \[tex]$41,176 - \$[/tex]89,075 at 22%
Since [tex]$75,400 is within this bracket,
\[
\text{Tax} = (75,400 - 41,175 + 1) \times 0.22 = 34,225 \times 0.22 = 7,531.30
\]
2. Sum the tax owed for each bracket:
\[
\text{Total Tax} = 1,027.50 + 3,708.00 + 7,531.30 = 12,266.80
\]
3. Calculate the effective tax rate:
\[
\text{Effective Tax Rate} = \left(\frac{\text{Total Tax}}{\text{Taxable Income}}\right) \times 100 = \left(\frac{12,266.80}{75,400}\right) \times 100
\]
This equals approximately:
\[
16.27\%
\]
Thus, the effective tax rate for a taxable income of $[/tex]75,400 is approximately [tex]\( \boxed{16.27\%} \)[/tex].
