Tax Tables 2009 California
December 12th, 2009
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Question: Income Tax – I live in California & my wages are a little over $38500 a year (head of household 2 dependents)?
Doesn’t go a long way here, but I was left a property by my mother who passed away late last year, and I started renting it out this year. After HOA payments and payment for a realtor to handle it, it brings in additional income of just under $10000 a year. I look at my tax table for 2009, and it says if you make over $45,000 a yr, the income tax goes up from 15% (with an additional $1195) to 25% with an additional $6,227.50. Am I understanding this, because if I am, I will be making less than I was before? Am I right or wrong?
I think I understand now. But what is the plus $1195 for 15% and $6,227 for 25%? So somebody that is making over $45000 on adjustable income pays the same $6227 as someone making 117,000 adjustable income? (My youngest will be 17 this year, so no more child credits for me).Thank you so much for this information.
Answer: If you file schedule E for your rental income, you must claim any expenses related to that income. Expenses such as Depreciation expenses on the property plus other deductible expenses. Your taxable income from rental is your net income, income after expenses.
Also the tax rate is applied to your taxable income, so if your total income $50,000 and you are HOHH with 2 dependents, then your taxable income is;
Taxable Income = AGI – (Std Deduction + Personal Exemptions)
Taxable Income = $50,000 – ($8,350 + $10,950) = $30,700Since your taxable income is $30,700 then your tax is
$1195 + (15% X ($30,700 – $11950)) = $1195 + (15% X $18750) =
$1195 + $2813 = $4008 this is your tax liabilitySince you qualify for the new 2009 Tax Credit called MAKE WORK PAY TAX CREDIT of $400 then your net tax liability is;
$4008 – $400 = $3608If your children are under 17 yrs old, you may qualify for the Child Tax Credit of up to $1000 per child and that will reduce your tax liability.
AGI = Adjusted Gross Income
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