neogenesis2004

iTrader: (12)

I misread what the poll was asking for apparently. I though bracket was what was in question. I can't change my vote, but I'll be paying ~18% in Fed Tax and like 3% to VA.

bbundy

40% of federal revenue in 2010 came from tax on income from working that is not accounted for on tax returns, “Payroll Tax” It is paid primarily by people making less than 100k and many of them pay income tax on top of that payroll tax making the true tax rate much higher than the oligarchs want the ignorant to believe. All forms of federal tax you pay goes into the same bucket. It is all tax and should be accounted for as part of your tax burden not just the tax shown on your return. apples to apples.

If you make all your income from working you and make less than ~100k individual you start at 15.3 % for instance. And then the numbers calculated from your tax return adjust from there.

Scrappy Jack

iTrader: (2)

I am telling you, this subject is confusing for most people. Are you dividing your Federal income taxes paid by your taxable income or your adjusted gross income (AGI)? They are different numbers. Your taxable is less than your AGI.

Like I said, it's a confusing subject for most people which is a testament to how knackered the tax code is these days that we can't even have a reasonable discussion about one metric among some very intelligent people.

Fine, Bob. Total taxes paid is the "apple" and Federal income tax divided by AGI is the "orange," but this thread started out with comparing the latter. My point is not that one is more or less relevant than the other (I would argue that total taxes paid in is the more legitimate measure), but that people are not using the same metric in their comparisons.

It does not make sense to compare marginal versus effective Federal income or effective Federal income vs effective total Federal (or effective total Federal + total municipal).

Do you understand that point or not?

Joe Perez

iTrader: (8)

Yes, you do get to deduct one-half of the Schedule SE tax on the Form 1040 tax.

This is not the same, however, as being a regular employee. If you have a W2, then your employer pays "their half" of what would otherwise be the SE tax directly, so it's an invisible transaction that does not affect either your salary or your net income at all.

By claiming 1/2 of the SE tax as a deduction, you only lower your net tax by (1/2 of SE tax * your effective 1040 tax rate).

So all they're doing is not making you pay tax on half of the money that you used to pay the SE tax. It's still quite costly.

mgeoffriau

iTrader: (7)

Just a tick over 5%.

Enginerd

iTrader: (1)

Benefits of home ownership:

This year: over $3500 refund based on single tax withholdings & half year home ownership (not allowed to include last years property tax as a deduction since it's 'seller paid').

Next year: over $25,000 itemizing and $60 MORE per paycheck staying in my wallet instead of Uncle Sam's. That's $1560 MORE in yearly take home pay versus when I was renting. Check your finances! I'll take home ownership over renting any day of the week!

jbresee

21% Federal for 2011, 31% in 2010. VT taxes add a bunch to the % of total taxes.

Pitlab77

iTrader: (3)

I am confused now.

Braineack

iTrader: (62)

untill you gotta replace a roof, or the hvac, or the foundation is cracked, or you have termites...

neogenesis2004

iTrader: (12)

I was thinking the same thing Brain. It's no cheaper, its just deferred cost.

Bryce

iTrader: (24)

This. I had an internship over the summer, made just under $10k, and am getting ~$630 back. When do I get my free loan from the gov't?

Joe Perez

iTrader: (8)

Just started doing my taxes for 2011. This one's gonna hurt. I maxed out Schedule SE line 10 by quite a large margin, even after $50,897.65 in Schedule C line 28 expenses.

Why the hell don't I feel rich? The IRS clearly thinks I am.

Alameda

I had a job last year that required me to live in a different state for a few months. It was lovely paying that state's revenue tax along with my home state's residence tax. I was at an effective tax rate of 33% at the time because of it, and I was not making much money. I will get most if not all of it back, but still...

Enginerd

iTrader: (1)

Quit school and adopt a few kids. I hear the going rate is just over $13,000/year, refundable...better than intern pay!

redfred18t

iTrader: (1)

total income: 14% federal, 18% when you factor in my CT and MA taxes.
taxable income: 17% fed, 23% states


Could be worse I guess. Only thing I have going for me is my student loan interest but hopefully I can pay them off in a few years.

Joe Perez

iTrader: (8)

Well, that was fun.

Total gross receipts: $192,055 (Schedule C line 1d)
Total expenses: $50,897 (Schedule C line 28)
Adjustments & Deductions: a little over $15k (1040 lines 36+40)
Total Fed tax: a little over $42k
Effective Federal tax rate (line 38 / line 61): 32.4%

Add in a little over $9k in CA tax and I'm at 39.5% total for the year. Called it in post #2.

Time to write another big damn check.

Sam, as a fellow member of the six figure club, I seriously want to know how the hell you're getting away with 8.8%.

Scrappy Jack

iTrader: (2)

Think you can swing a condo mortgage payment in Florida for ~$750/month and live there for 183 days per year? Between the mortgage deduction and lack of state income tax on earnings, you could put that $9k/year in to something with some utility/price appreciation potential. That especially might work out better if you can do short-term rentals (think: Daytona, Cocoa, New Smyrna, Clearwater, etc).

How about a pre-tax retirement plan? Even if you are a 1099 contractor vs W-2 employee, you can may be able to set up a self-employed plan like a SEP or solo-401k to reduce your taxable income.

Scrappy Jack

iTrader: (2)

Moved from 25% to 28% marginal (in large part due to a one-time bonus) and from 16% to 20% effective (MFJ). Paid about $15k more in taxes this year. Some of my planning got skewed by a last-minute, unexpected, one-time bonus (a good problem to have). Income probably won't be as high for 2012.

We have also increased our charitable gifting and retirement savings.

Faeflora

iTrader: (2)

I just did my taxes. Took me four hours.

Am getting back a ridiculous amount of money.

Active interest vs passive interest FTW. yay.

Also, uncle sam rewards those who put their money "at risk" for potential business gain.

Faeflora

iTrader: (2)

Indeed. I had to drop one grand today on a busted water heater. And one of my bathrooms needs retiling. And kitehen needs granite and demeyere pans.

Joe you have enough moolah to live as you please, for the most part. I spent xx,xxx last year on food and drink. Time for you to step up from crappy ol captain n coke. Day to day niceties can help you enjoy your income much more.