How do you calculate the tax rate?
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The most straightforward way to calculate effective tax rate is to divide the income tax expenses by the earnings (or income earned) before taxes. For example, if a company earned $100,000 and paid $25,000 in taxes, the effective tax rate is equal to 25,000 -- 100,000 or 0.25.
2023-05-07 15:02:50
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Sophia Lewis
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The most straightforward way to calculate effective tax rate is to divide the income tax expenses by the earnings (or income earned) before taxes. For example, if a company earned $100,000 and paid $25,000 in taxes, the effective tax rate is equal to 25,000 -- 100,000 or 0.25.