Question

A warehouse manager earns an annual salary of $65,700, and he contributes $5800 per year to his 401(k) plan. If he has a required deduction for income taxes (federal, state, and local combined) of 26% of pretax income, how much does he have withheld in income taxes per year?

Answer 1

The answer is 15,574

Answer 2

The answer is $15,574.

Explanation:

A warehouse manager earns an annual salary of $65,700, and he contributes $5800 per year to his 401(k) plan.

Now, the pretax income becomes =
`65700-5800=59900` dollars.

Now, multiplying the percentage withheld for taxes by the pretax income to get the manager's income tax withholding.

This becomes :
`0.26*59900=15574` dollars.

Therefore, the answer is $15,574.