GOP to Jobless: Drop Dead

[Fast_Eddie]

Originally Posted by whell

Also, the increased Medicare withholding on wages/investment income starts in 2013, so that may be why you're not finding it in 2010 tax calculation data.

Yeah...

Originally Posted by whell

Current Highest Federal income tax rate = 35%
FICA Tax = 6.2%
Medicare Tax = 1.45%
Total tax on income - 42.65

Under PPACA, the Medicare tax will increase to 2.35% for income earned over $200K. Total income tax = 43.35%

You were talking about 2010 when you said 42.65.

[d-ray657]

Originally Posted by whell

I know you're not suggesting here that taxable income is the same as W-2 income. "Taxable income" can be derived from a number of sources. W-2 income = wages. I was pretty clear about what I was referring to: W-2 income. Why try to make this into something its not?

What you are ignoring is that the high rate you identified does not apply to all W-2 wages. You are actually talking about the marginal rate - the rate that applies to all income above a particular amount. Tax is not being and will not be withheld at the 42.6% rate. The tax charts take account to what the average tax rate would be if the employee earned at a particular rate throughout the year. Say an employee with an annual salary of $520k, would have wages/salary at the rate of $10k per week. The charts would take into account that the first $50k will be taxed at 15%, between 50K and 70k will be taxed at 20% and between 70K and 250k will be taxed at 28% and above that will be taxed at 35% (Making up the dividing lines here, simply for demonstrative purposes) You would look at the first weekly check and see deductions at a rate lower than 35% and the last weekly check would make deductions at a the same rate (except that income over $111k will not be taxed for social security)

Whell, do you doubt that persons earning a salary above $250k are not paying the top rate on all of their earnings. You can't say that the tax rate for part of the income (the marginal rate) is the actual tax rate that will be paid on w-2 earnings. Taking this truth into account is not changing the issue - it's refusing to acknowledge the premise of your position.

Actually, looking at your numbers again, it is absolutely false that the tax rate that applies to income over $250k is 42.6%, because at that point the taxpayer is not paying FICA, thereby reducing the marginal rate at that point to 36.4%. Therefore, your premise is not only illogical, it is factually incorrect.

Regards,

D-Ray

[Fast_Eddie]

whell, can you save us all a step and just post the source for your 40+% tax propoganda? It will be much easier if we can just look at it for ourselves rather than filtering it though you.

[whell]

Here's the 35%: http://www.taxfoundation.org/taxdata/show/151.html

You can also find it here, page 8: http://www.irs.gov/pub/irs-pdf/f1040es.pdf

Can we agree that FICA is 6.2% and Medicare is 1.45%

35 + 6.2 + 1.45 = 42.65%.

This is on income earned over $373500. Income below that amount is taxed at a lower rate.

[Fast_Eddie]

FICA has a cap of $6,621.60. You only pay the 6.2 on the first $106,800 of income. No cap on the 1.4%

Look at your link- it is talking about "marginal tax rate" which we have tried over and over again to explain to you.

If you are in that 35% marginal rate, you only pay 35% on income over $373,650 (according to your link - I assume it is right). So if you make $373,650, you pay 10% on the first $11,950. 15% on the portion from $11,950 to $44,550. Etc.

Honestly, please, take our word for it. You are just wrong on this one. No shame in it. Our tax code is pretty confusing.

[whell]

By the way, please don't tell me I'm "wrong" on this. You folks were the ones attempting to calculate the actual taxes, and you were calculating the taxes incorrectly.

[Fast_Eddie]

Originally Posted by whell

By the way, please don't tell me I'm "wrong" on this. You folks were the ones attempting to calculate the actual taxes, and you were calculating the taxes incorrectly.

Please, read the link I posted on the other page:

http://taxes.about.com/od/preparingy...ax-rates_2.htm

Or use the IRS calculator:

http://www.irs.gov/individuals/artic...=96196,00.html

No. We're not.

YOU ARE WRONG

[whell]

Originally Posted by Fast_Eddie

FICA has a cap of $6,621.60. You only pay the 6.2 on the first $106,800 of income. No cap on the 1.4%

Look at your link- it is talking about "marginal tax rate" which we have tried over and over again to explain to you.

If you are in that 35% marginal rate, you only pay 35% on income over $373,650 (according to your link - I assume it is right). So if you make $373,650, you pay 10% on the first $11,950. 15% on the portion from $11,950 to $44,550. Etc.

Honestly, please, take our word for it. You are just wrong on this one. No shame in it. Our tax code is pretty confusing.

Again, I was simply posting the "highest tax rate." I wasn't the one who went about attempting to (incorrectly) calculate actual tax liability.

[whell]

Originally Posted by Fast_Eddie

Please, read the link I posted on the other page:

http://taxes.about.com/od/preparingy...ax-rates_2.htm

No. We're not.

YOU ARE WRONG

LOL. Before we figure out who was "wrong" you might want to edit prior posts and clean up your calculations.

[Fast_Eddie]

Originally Posted by whell

35 + 6.2 + 1.45 = 42.65%.

This is on income earned over $373500. Income below that amount is taxed at a lower rate.

You are still wrong because of the FICA cap.