# Question & Answer: Manny, a single taxpayer, earns \$370,000 per year in taxable income and an additional \$23,000 per year in city of Boston bonds……

Manny, a single taxpayer, earns \$370,000 per year in taxable income and an additional \$23,000 per year in city of Boston bonds.

If Manny earns an additional \$70,000 in taxable income in year 2017, what is his marginal tax rate on this income?

M’s income = 370000+23000= \$393,000

M’s taxable income is 393000, Hence taxable income is In between 191650 to 416700, hence the marginal tax rate at that percent is 33%

Therefore marginal rate is 33% before consideration of additional taxable income,

If 70000 additional taxable income 70000 is considered then the marginal tax rate would be as follows

Taxable Income = \$370000+\$70000+\$23000 =463000

From the above the taxable income is 463000, which is more than 418400, hence the marginal tax rate would be at 39.60%

Therefore the marginal tax rate in the year 2017 is 39.60%

*Note :tax rate is considered for single tax payer and for the year 2017 .