Given the Following Tax Structure, What Is the Minimum Tax

question 69

Essay

Given the following tax structure, what is the minimum tax that would need to be assessed on Lizzy to make the tax progressive with respect to average tax rates? What is the minimum tax that would need to be assessed on Lizzy to make the tax progressive with respect to effective tax rates? $\begin{array}{l}\begin{array} { c c c } \underline{\text { Taxpayer }}&\underline{\text { Salary }} &\underline{ \text { Muni-Bond Interest }} & \underline{\text { Total Tax }} \\\\\text {Mort}&20,000 & 5,000 & 4,000 \\\text {Lizzy}&80,000 & 30,000 & ? ? ?\end{array}\end{array}$

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Definitions:

Rescission

The act of revoking, canceling, or annulling a contract, returning all parties to their statuses prior to the contract's formation.

Mistake of Law

An error made by a person in understanding the law as it pertains to their actions, which generally is not considered a defense in criminal law.

Duress

A situation where someone acts against their will or is forced into an agreement or decision under pressure or threat.

Improper Threat

A form of coercion that is illegitimate or unethical, used to induce another party to act in a manner they otherwise would not.