Problem

A certain state uses the following progressive tax rate for calculating individual income tax:
\begin{tabular}{c|c}
\( \begin{array}{c}\text { Income } \\
\text { Range }(\$)\end{array} \) & \( \begin{array}{c}\text { Progressive } \\
\text { Tax Rate }\end{array} \) \\
\hline \( 0-10,000 \) & \( 3 \% \) \\
\( 10,001-50,000 \) & \( 5 \% \) \\
\( 50,001-100,000 \) & \( 5.5 \% \)
\end{tabular}
Calculate the state income tax owed on a \( \$ 90,000 \) per year salary.
\[
\operatorname{tax}=\$[?]
\]

Answer

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Answer

4. Add all taxes: \(300 + 2,000 + 2,200\) = \(4,500\)

Steps

Step 1 :1. Calculate tax for income range \(0-10,000\): \(10,000 * 0.03\) = \(300\)

Step 2 :2. Calculate tax for income range \(10,001-50,000\): \((50,000 - 10,000) * 0.05\) = \(40,000 * 0.05\) = \(2,000\)

Step 3 :3. Calculate tax for income range \(50,001-90,000\): \((90,000 - 50,000) * 0.055\) = \(40,000 * 0.055\) = \(2,200\)

Step 4 :4. Add all taxes: \(300 + 2,000 + 2,200\) = \(4,500\)

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