mary watson is 24 years old and single, lives in an apartment, and has no dependents. Last year she earned $45,000 as a sales assistant for focused business analytics: $3,910 of her wages was withheld for federal income taxes. In addition, she had interest income of $142. Estimate her taxable income, and tax refund or tax owed
an investor expects a stock to double in 7 years, what is the expected annual rate of growth?
To estimate Mary Watson's taxable income and determine whether she would receive a tax refund or owe taxes, we need to consider her income and potential deductions.
1. Start with her total income:
- Mary earned $45,000 as a sales assistant at Focused Business Analytics.
- Add her interest income of $142.
Total Income = $45,000 + $142 = $45,142
2. Calculate her Adjusted Gross Income (AGI):
- AGI is calculated by subtracting eligible deductions from her total income.
- Since we don't have information about her deductions, let's assume she takes the Standard Deduction for a single individual. For the tax year 2021, the Standard Deduction for single individuals is $12,550.
AGI = Total Income - Standard Deduction = $45,142 - $12,550 = $32,592
3. Determine her Taxable Income:
- Taxable Income is calculated by subtracting any further deductions or adjustments from her AGI. However, without additional information, we'll assume that there are no further deductions.
Taxable Income = AGI = $32,592
4. Estimate her tax liability:
- To estimate the tax liability, we'll use the tax brackets for the tax year 2021. Keep in mind that tax brackets can change, so this estimate may not be entirely accurate.
- As a single individual, Mary would fall into the 22% tax bracket for income between $40,525 and $86,375.
Tax Liability = Taxable Income * Tax Rate = $32,592 * 0.22 = $7,170.24
5. Calculate Mary's tax refund or tax owed:
- To determine if Mary is eligible for a refund or needs to pay additional taxes, we need to consider the amount withheld for federal income taxes.
- Mary had $3,910 withheld for federal income taxes.
Tax Refund (or Tax Owed) = Taxes Withheld - Tax Liability = $3,910 - $7,170.24 = -$3,260.24
Therefore, based on the information provided, it seems that Mary would owe approximately $3,260.24 in taxes. However, please note that this is an estimation and the exact amount may vary based on any additional deductions or adjustments Mary may have. It's always recommended to consult a tax professional for accurate calculations.