need help with homework

Question

Harold and Wanda (married filing jointly) have $30,000 ordinary income after the standard deduction and personal exemptions, and $50,000 in unrecaptured depreciation on the sale of rental property for a total taxable income of $80,000.

For 2015, the 10 percent tax bracket for married taxpayers filing jointly ends at $18,450, the next $56,450 in taxable income is taxed at 15 percent, and 25 percent applied to the next $74,900.

What is Harold and Wanda's tax? (Please use the percentages given in this problem to calculate your answers.)
A. $11,077.50
B. $11,587.50
C. $11,594.00
D. $16,077.50

 

Can you help me understand this?

Answer 1

Larry,

Because 80000 is more than 18450 + 56450, there will be some money taxed at each of the three rates. The 18450 at 10%, the 56450 at 15%, and the remainder at 25%.

 

80,000 - 18450 - 56450 = 5100

 

18450 * .1 + 56450 * .15 + 5100 * .25 = $11,587.50

 

I hope that helps.