Some people wonder if they can pay the
rent with their current salaries. A privileged few actually save enough for
small vacations at the local bar once or twice a month. The rest of us see our
paycheck waltz into the hands of politicians who use public funds to book
airplane seats for their pet bunnies. Yes. It really happened.
Municipal, city, county, and state taxes
vary from place to place, but federal taxes remain the same all across these United
States. Thus, the first step in determining the amount each citizen pays in
taxes is to calculate how much is lost from each paycheck in federal taxes
First things first. All Americans pay 6.2% in Social Security and 2.9% in Medicare Tax.
Those are federal taxes. Those percentages are taken off total earned income. That means all working Americans begin
with an automatic 9.1% tax on their income, barring specific circumstances.
Federal Income Tax is added atop that 9.1%.
The Federal Tax Brackets for 2019 are:
Rate
|
Unmarried, Single
|
Married, filing jointly
|
Heads of Household
|
10%
|
$0
|
$0
|
$0
|
12%
|
$9,700
|
$19,400
|
$13,850
|
22%
|
$39,475
|
$78,950
|
$52,850
|
24%
|
$84,200
|
$168,400
|
$84,200
|
32%
|
$160,725
|
$321,450
|
$160,700
|
35%
|
$204,100
|
$408,200
|
$204,100
|
37%
|
$510,300
|
$612,350
|
$510,300
|
Take a basic annual salary of $32,750
for a single person. This is about $15.75 an hour. Using the Federal Income tax
brackets for 2019 the breakdown is as follows:
Est. Income
|
SS Tax 6.2%
|
Med Tax 2.9%
|
Fed Inc. Bracket 10%
|
Fed Inc Bracket 12%
|
Total Fed Taxes in $
|
Total Fed Tax in %
|
$9700*.10
|
($32750-$9700)*0.12
|
|||||
$32,750
|
$2,030.50
|
$949.75
|
$970.00
|
$2,766.00
|
$6,716.25
|
20.50763359
|
Before any
deductions,
a person making $32,750 annually will pay the Federal Government $6,716.25.
This amount includes the Social Security Tax and the Medicare Tax. That amount
equates to 20.5 % of total income to Federal Taxes instead of 12%!
Let that number sink in.
Wow! How come it's so much?
Because the Social Security and Medicare
Tax aren’t bracketed. That 9.1% is from the total annual income.
Following is the mistake most people fall
into when they think about Fed Taxes. Let’s use the $32,750 annual income as
the example once more.
Est. Income
|
12% Fed Inc. ($32,750*.12)
|
$32,750
|
$3,930.00
|
Well, chucks. That would make things
easy. But no. This doesn’t take into consideration.
(1) The Federal Income Brackets.
(2) Social Security Tax of 6.2% on total
income.
(3) Medicare Tax of 2.9% on total
income.
In essence, Americans are taxed 3 times
on the same amount of earnings.
One time for Social Security; flat percentage tax on income.
One time for Medicare; flat percentage tax on income.
One
time for Fed Income Tax; using the income brackets.
Keep in mind, folks, these numbers do
not include sales taxes, state taxes, municipal taxes, city taxes, vehicle tag
fees, car insurance, property taxes, or any other “mandated by law” expense
that has been imposed on the populace by state and federal legislature. The amount each American pays in taxes is
much, much higher.
Now you know why you can't afford expensive underwear.
***
Want to provide feedback? Did I screw
the numbers up? See a mistake? Post below!
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