Suppose that Megan is preparing to file her taxes. She is single and currently lives in Denver. Megan earned $110,000 in taxable income in 2022. She reviews the following table, which shows the IRS tax rates for a single taxpayer in 2022.
On Annual Taxable Income... The Tax Rate Is... (Percent)
Up to $10,275 10.0
From $10,275 to $41,775 12.0
From $41,775 to $89,075 22.0
From $89,075 to $170,050 24.0
From $170,050 to $215,950 32.0
From $215,950 to $539,900 35.0
Over $539,900 37.0
Based on the IRS table, Megan calculates that her marginal tax rate is 24% when her annual taxable income is $110,000.
Megan calculates that she owes \_\_\_\_\_\_\_\_ in income taxes for 2022.
Megan then calculates that her average tax rate is \_\_\_\_\_\_\_\_, based on the annual income level and the amount of taxes she owes for 2022.
After figuring out what she owes in taxes in 2022, Megan decides to ask an accountant for tax advice. The accountant claims that he has found a legal way to shelter $2,000 of taxable income from the federal government.
The maximum amount that Megan is willing to pay to learn this strategy and reduce her taxable income by $2,000 is \_\_\_\_\_\_\_\_. (Hint: Sheltering some income means finding a legal way to avoid being charged income tax on that income. For example, someone who has $50,000 in taxable income and shelters $10,000 pays income tax on only $40,000.)
