Question

Daniel Stake has a yearly income of $28,940 and claims 4 exemptions. The amount allowed for each exemption is $900. His local tax rate is 4.75%. How much local income tax should be withheld from his monthly earnings?

Answer 1

because he has claimed 4 excemptions for $900 each, he has 4*$900 exempt from the annual income tax

subtract this from the original income, to get the non-exempt annual income

multiply this by the tax rate, 0.0475

now, this is the annual income tax he owes. to find the monthly tax, divide this by 12