AM I GETTING THERE? State taxes, Property Taxes..etc.

[some1blessed]

The first position is in Pennsylvania, earning $50,000 a year. You found a starter duplex that you can purchase with the assessed value of $75,000. Property taxes average 2.975% of the purchase price. The state sales tax is 6% on purchases, but this does not apply to food and clothing. The state income tax is 3%.
•The second offer is in Maryland. You would earn $65,000, with a starter duplex assessed at $135,000. In Maryland, property taxes are 2.4% of the purchase price of the property. The sales taxes are 1% higher than in Pennsylvania, and it also applies to food and clothing. Maryland's state income tax is 1.5% higher than Pennsylvania's.
annual purchases are approx. $18,000 plus an addtl. $6,000 in food and clothing
•What is the difference in cost of living between the 2 locations based on the differences in sales tax, income tax, and property tax?
(Hint: Property tax only applies to housing, state sales tax only applies to purchases and food and clothing when applicable, and income tax only applies to the salary):



Tax PA
Salary 50,000
Purchases 18000+1080=19080
Food and Clothing 6,000
Property Taxes 75000(0.02975)=2231.25
Sales Taxes 18000(0.06)=1080
State Inc. Taxes 50000(0.03)=1500

Tax MD
Salary 65,000
Purchases 18000+1260=19260
Food and Clothing 6000+420=6420
Property Taxes 135,000(0.024)=3240
Sales Taxes 18000=6000x0.07=1680
State Inc. Taxes 65,000(0.045)=2925

Difference
15,000
180
420
1008.75
600
1425





This is what I have so far, am I doing this correctly. If you could guide me in the right direction I would very much appreciate it. Thanks in advance for your help.

 

[Deleted member 4993]

The first position is in Pennsylvania, earning $50,000 a year. You found a starter duplex that you can purchase with the assessed value of $75,000. Property taxes average 2.975% of the purchase price. The state sales tax is 6% on purchases, but this does not apply to food and clothing. The state income tax is 3%.
•The second offer is in Maryland. You would earn $65,000, with a starter duplex assessed at $135,000. In Maryland, property taxes are 2.4% of the purchase price of the property. The sales taxes are 1% higher than in Pennsylvania, and it also applies to food and clothing. Maryland's state income tax is 1.5% higher than Pennsylvania's.
annual purchases are approx. $18,000 plus an addtl. $6,000 in food and clothing


Tax PA
Salary 50,000
Purchases 18000+1080=19080
Food and Clothing 6,000
Property Taxes 75000(0.02975)=2231.25
Sales Taxes 18000(0.06)=1080
State Inc. Taxes 50000(0.03)=1500

Tax MD
Salary 65,000
Purchases 18000+1260=19260
Food and Clothing 6000+420=6420
Property Taxes 135,000(0.024)=3240
Sales Taxes 18000=6000x0.07=1680
State Inc. Taxes 65,000(0.045)=2925

Difference
15,000
180
420
1008.75
600
1425





This is what I have so far, am I doing this correctly. If you could guide me in the right direction I would very much appreciate it. Thanks in advance for your help.

You do not tell us "what" you were supposed to calculate - wher you were supposed to go.

Thus I cannot tell you the direction - right or wrong!!

 

[lrecha]

Your doing great

Hello,
Thanks for your post. It was very helpful to me. I have a question, what does purchases mean? I think I understand, food and clothing has a tax of 3% and is it other additional purchases has a 6% tax? So, what is the meaning purchases? You multiplyed the 3% sales tax for food and clothing. Do you need to also multiply the 6% purchases to the food and clothing taxes too? Besides this question your doing a good job. Yours truly lrecha