Based on the state tax rate, and the personal allowance amount, the amount withheld from the monthly paycheck for state income tax is $12,036.83.
How much was withheld for state income tax?
First, find out the allowance that reduces the CEO's annual salary:
= 2,899,840 - 4,000 for married - (2,000 x 4 dependents)
= $2,887,840
The income tax for the year is:
= (1.50% x 1,000) + (3% x 2,000) + (4.50% x 2,000) + (5% x (2,887,840 - 2,000 - 2,000 - 1,000))
= 150 + 60 + 90 + 144,142
= $144,442
The monthly amount is:
= 144,442 / 12
= $12,036.83
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