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One more hypothetical. This time, well and clearly into the highest marginal tax rate.
Income - $400,000
Effective income tax rate - 28.59%
Marginal income tax rate - 35%
Total income tax –$114,360
Income taxed at marginal rate of 35% - $62,350
Total tax paid at marginal rate - $21,822.50
FICA - 6.2% on first $106,800
Total FICA - $6,621.50
Medicare -1.45%, no cap
Total Medicare - $5,800
Medicare on income taxed at marginal rate – $904.08
Total federal income tax paid including SS and Medicare - $126,781.5
Percent of total income – 32%
Total tax paid at marginal rate of 35% plus Medicare – $22,726.58
Percent of marginal tax income – 36%
I'm honestly trying to find a scenario that gets us to 40+%. This is the best I can do. Figuring the percentage ONLY on the taxes paid at 35% plus the Medicare taxes paid on that portion of income. "Worst" I could do was 36% on any portion of income.
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Two days slow. That's what they are.
Last edited by Fast_Eddie; 11-18-2010 at 05:03 PM.
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