Calculating income tax

Two brackets, one income. Compute the tax on the first bracket's chunk, then on whatever spills into the second bracket, then add.

01 Worked Example Video

Every step of Calculating income tax explained on video. Pause anywhere; the embed scrolls independently of the page.

YOUTUBE

02 What This Looks Like on ALEKS

ALEKS randomizes the numbers each attempt, but the question shape stays the same. Here are three example versions you might see.

Latoya

Latoya’s taxable income: $40,000. Rate: 10% on the first $9,500, 15% on the amount over.

Find the total tax. Type just the number.

tax = $

Devin

Devin’s taxable income: $28,000. Rate: 12% on the first $11,000, 18% on the amount over.

Find the total tax. Type just the number.

tax = $

Mira

Mira’s taxable income: $55,000. Rate: 8% on the first $15,000, 22% on the amount over.

Find the total tax. Type just the number.

tax = $

Heads up: Your ALEKS version will use different numbers. The numbers in the practice below are different too — that way you're exercising the move, not memorizing one answer.

03 The Rule

tax = r₁ × bracket₁ + r₂ × (income − bracket₁) split income at the bracket boundary

First bracket → lower rate spillover → higher rate; add the two

Progressive tax: the first bracket’s income is always taxed at the lower rate — only the spillover above the boundary gets the higher rate. Compute the two pieces separately and add.

Common slips

(1) Taxed the whole income at the higher rate. That ignores the cheaper first bracket. (2) Forgot to subtract for the spillover. The higher rate only applies to income over the boundary. If you write 15% × $40,000 instead of 15% × ($40,000 − $9,500), you’re double-taxing the first $9,500. (3) Used percentages instead of decimals. Convert first: 10% = 0.10, 15% = 0.15.

04 Practice — Step by Step

Practice this problem step by step

Taxable income $25,000. Tax rate: 10% on the first $10,000, 20% on the amount over $10,000. Find the total tax.

Step 1

Tax the first bracket

The full first bracket ($10,000) is taxed at 10%. Compute 0.10 × $10,000.

= $

Step 2

Tax the spillover

Spillover = $25,000 − $10,000 = $15,000. Compute 20% of that.

= $

Step 3

Add the two pieces

Total tax = $1,000 + $3,000.

total = $

Q36 Q38

Calculating income tax

You walked the two-bracket tax move end to end.