Abby lives in a state in which the state income tax rate is equal to 5.38% of federal taxable income. abby’s federal income tax is equal to 19.6% of her federal taxable income. if abby owes $8,880.17 in federal income tax, how much does she owe in state income tax?
Answer:
The Abby owe in state income tax is $2437.52 .
Step-by-step explanation:
Let us assume that the federal taxable income be x .
As given
Abby’s federal income tax is equal to 19.6% of her federal taxable income.
If abby owes $8,880.17 in federal income tax .
19.6% is written in the decimal form
\(= \frac{19.6}{100}\)
= 0.196
Thus equation becomes
0.196 × Federal taxable income = Federal income tax
0.196 × x = 8880.17
0.196x = 8880.17
\(x = \frac{8880.17}{0.196}\)
x = $45306.9898
Thus federal taxable income is $45306.9898 .
As given
Abby lives in a state in which the state income tax rate is equal to 5.38% of federal taxable income.
5.38% is written in the decimal form
\(= \frac{5.38}{100}\)
= 0.0538
Thus
State income tax = 0.0538 × Federal taxable income
= 0.0538 × $45306.9898
= $2437.52 (Approx)
Therefore the Abby owe in state income tax is $2437.52 .