a specified interval of income to which a specific and unique marginal tax rate is applied is called a. an average tax rate. b. a tax bracket. c. a tax rate. d. a tax base.
Your filing status and taxable income determine your tax bracket.
What is marginal tax rate ?
The marginal tax rate is the amount of extra tax paid for every additional dollar of income earned. The average tax rate is calculated by dividing total tax paid by total income earned.
A marginal tax rate of 10% means that 10 cents of every additional dollar earned is taxed.
For each associated bracket, the marginal tax rate formula is
Marginal Tax Rate = Tax Paid/ Taxable Income.
The US Progressive marginal tax system has seven tax brackets. Each has a taxable income range with corresponding marginal tax rates. It also establishes the worth of a particular deduction for a taxpayer.
