Tax Determination- Tax Table Method

Date: Tuesday, September 9, 2008
Time: 11 PM
Place: Kitchen

The tax liability is computed using either the Tax TAble method or the Tax Rate Schedule method. Most taxpayers compute their tax using the Tax Table. Eligible taxpayers compute taxable income and must determine their tax by reference to the Tax Table. The following taxpayers,however, may not use the Tax Table method:
-an individual who files a short period return
-individuals whose taxable income exceeds the maximum amount in the Tax Table.
-an estate or trust.

The IRS does not release the Tax Table until late in the year to which they apply. The Tax Rate Schedules, however, are released at the end of the year preceding their applicability. Although the Tax Table is derived by using the Tax Rate Schedules, the tax calculated using the two methods may vary slightly. This variation occurs because the tax for a particular income range in the Tax Table is based on the midpoint amount.