The monthly pay for Jerry is $6500.
Jerry hit the maximum taxable social security income in the 3.36 months.
The social security tax Jerry paid in January is $403
The social security tax Jerry paid in December is zero
What is monthly gross pay?
Monthly gross pay is the amount received by an employee monthly prior to the time at which tax and other deductions are being taken from his/her account.
From the parameters given:
A.
Jerry earned $78000 yearly; her monthly gross pay can be computed as:
[tex]\mathbf{=\dfrac{78000}{12}}[/tex]
= $6500
B.
The federal tax rate for a single person in 1990 is 28.0%
From $78000, Jerry tax rate = $21840
Therefore, the month that Jerry reaches maximum taxable social security income is computed as:
[tex]\mathbf{=\dfrac{\$21840}{\$6500/month}}[/tex]
= 3.36 months
C.
Let's assume that the social security tax rate in 1990 was 6.20%.
Then, the amount of social security tax paid in January (since it is a single month) is:
[tex]\mathbf{= \dfrac{6.20}{100} \times \$6500}[/tex]
= $403
D.
Provided that the number of months required to complete the maximum social security tax is 3.36 months and the social security tax we are to determine is more than 3.36 months(December);
We can conclude that the social security tax Jerry paid for the month of December is zero.
Learn more about monthly gross pay here:
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