Chapter 2 Understanding Your Paycheck
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Section 2.1 Calculating Taxes
Determine the federal withholding, Social Security tax, Medicare tax, and
state income tax, if applicable, for each of the following individuals. Use the tax
tables shown in Figures 2-2 and 2-3 for the problems in this section.
11. Lucretia, who works part-time as a substance abuse counselor, earns
$18.15 per hour and works 20 hours per week. She is single and claims one
withholding allowance. She lives in a state with no state income tax.
12. Luis, who works part-time as a nurse’s aide in a nursing home, earns
$11.90 per hour and works 28 hours per week. He is single and claims zero
withholding allowances. He lives in a state with a fl at-rate income tax of 3.5%.
13. Betty, who works as an animal control worker, earns $15.41 per hour and
works 40 hours per week. She is married and claims two withholding
allowances. She lives in a state with a fl at-rate income tax of 4.35%.
Section 2.2 Benefits
14. Angela is a veterinarian who earns $7,714 per month. She pays $435 per
month for health insurance for herself and her children. Her federal tax rate
is 25%. How much money will Angela save by having insurance premiums
withheld before taxes are calculated?
15. Sam is an agricultural inspector who earns $3,528 per month. He pays $258
per month for health insurance and $56.23 per month for vision insurance
for himself and his wife. His federal tax rate is 15%. How much money
will Sam save by having insurance premiums withheld before taxes are
calculated?
16. Lynn works on an aircraft assembly line, earning $45,230 per year. Her
employer contributes an additional $65 per month to her retirement plan,
and she pays $22.78 per month in labor union dues. Determine the net
annual value of Lynn’s job.