The Murphys will pay $20,500.80 in federal taxes on an annual gross household income totaling $85,420. Thus, the correct answer is C.
Individual federal income tax rates in the United States are progressive, which means that as taxable income rises, so will the tax rate. Federal income tax rates vary from 10% to 37% and are levied at various income levels. Tax brackets are the income ranges within which the rates apply. Income in each tax group is taxed at the associated rate.
The federal tax rate is 24%, as shown in the pie chart (see the attachment). While the annual gross household income for the Murphys is $85,420. Hence, the amount that the Murphys will pay for federal taxes is:
- = [tex]\frac{24}{100}[/tex] x $85,420
- = $20,500.80
Hence, the correct answer to this question is C.
Learn more about federal tax here: brainly.com/question/1601662
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