Question

Rhonda is currently in the 12 percent tax bracket. She reports a $400 tax deduction. How will this deduction affect her tax liability?

Answer 1

deduction affect her tax liability = $48

Step-by-step explanation:

given data

tax bracket = 12 %

tax deduction = $400

to find out

deduction affect her tax liability

solution

we get here deduction affect her tax liability that will be express as

deduction affect her tax liability = tax bracket × tax deduction ...............1

put here value we get

deduction affect her tax liability = 12 % × $400

deduction affect her tax liability = $48

so tax liability will decrease by $48 here only credits offset tax liability per dollar