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Pity the Poor Couple Who Make $450,000 Per Year

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Re: Pity the Poor Couple Who Make $450,000 Per Year

#71

Post by bhickey »

rdl wrote: post #69
bhickey wrote: post #68

Earlier quoted context omitted.

Sure, but you're leaving out FICA (6.2%) and Medicare (1.45%). This bumps the brackets to 40.65% and 42.65% (or 43.65% and 47.25%). After local taxes this can easily top 50%. Suppose you earned $357k gross in Rhode Island. Your total tax liability would be in the area of $189k, or 52.7%. All of this also ignores the employer FICA contribution.

FICA phases out around $100k, but there's also the future ObamaCare 3.8% tax (unearned income) 0.9% (earned income) as well (currently legislated to begin 1 JAN 2013).

I took this into account in my calculation. While, Social Security payments are capped at $102k (~$6k tax liability), Medicare is uncapped.

Re: Pity the Poor Couple Who Make $450,000 Per Year

#72

Post by rdl »

bhickey wrote: post #71
rdl wrote: post #69

Earlier quoted context omitted.

FICA phases out around $100k, but there's also the future ObamaCare 3.8% tax (unearned income) 0.9% (earned income) as well (currently legislated to begin 1 JAN 2013).

I took this into account in my calculation. While, Social Security payments are capped at $102k (~$6k tax liability), Medicare is uncapped.

The amusing thing for me is that there are certain incomes where the marginal rate actually goes down when income goes up (although absolute taxes paid always go up), due to phase-outs of deductions, various regressive taxes like FICA, local, etc.. It's actually quite complicated -- someone did a table on Quora, which I can't readily find right now, and it looks like the marginal rate peak for a single person was usually around 180-220k. From a purely efficiency standpoint, it seems like one would want the marginal rate function to be as smooth and ideally monotonic (if not strictly monotonic) as possible.

Re: Pity the Poor Couple Who Make $450,000 Per Year

#73

Post by ganley »

davidwparker wrote: post #48
guelo wrote: post #31

Earlier quoted context omitted.

Maybe you're right that this is racist. But I'm pretty sure that well over 90% of people making the argument that $450k is not enough money are indeed white. If the article was about gangster rap I don't know if it would be racist but it would be accurate to call it a degenerate black culture.

"But I'm pretty sure that well over 90% of people making the argument that $450k is not enough money are indeed white." Citation needed. I'm not sure whether I agree or disagree with your opinion, but stating claims like this without some kind of reference seems questionable.

That's not hard to track down; check census.gov. In fact, as of 2007 the distribution of households with incomes over $250K was 89% white.

http://www.census.gov/compendia/statab/cats/income_expenditu...

Re: Pity the Poor Couple Who Make $450,000 Per Year

#74

Post by ZachPruckowski »

mmaunder wrote: post #9

A few lessons here re the blog post being referred to: 1. The title "professor" does not confer knowledge, intelligence or wisdom. 2. Know that your online audience is diverse even if your regular readers aren't. 3. If you're in a prominent non-activist position, avoid discussing politics, religion or sex. 4. Never disclose details about your personal life, especially financials, unless you've thought it through and…

6. Before commenting on a hot topic, at least familiarize yourself with the basic. Like how the marginal income tax works. You don't have to be an expert, but at least skim the wikipedia page.

7. Avoid bold, unambiguous statements that are easily checkable, unless you've triple-checked them. It's trivial to map taxable income and what a tax plan will cost you, and saying "this policy will cost me $10,000" is pretty bold and unambiguous.

Re: Pity the Poor Couple Who Make $450,000 Per Year

#75

Post by ryanwaggoner »

bhickey wrote: post #68
guelo wrote: post #50

Earlier quoted context omitted.

There is no "50% tax bracket". Obama's proposed plan would raise the 33% and 35% brackets to 36% and 39.6%.

Sure, but you're leaving out FICA (6.2%) and Medicare (1.45%). This bumps the brackets to 40.65% and 42.65% (or 43.65% and 47.25%). After local taxes this can easily top 50%. Suppose you earned $357k gross in Rhode Island. Your total tax liability would be in the area of $189k, or 52.7%. All of this also ignores the employer FICA contribution.

Can you break down your calculation a little? It's way higher than what I got...wondering if you forgot that these are marginal tax rates?

Re: Pity the Poor Couple Who Make $450,000 Per Year

#76

Post by alextingle »

houseabsolute wrote: post #37
lionhearted wrote: post #32

Earlier quoted context omitted.

Edit: Obviously this argument isn't going to get resolved and it's unlikely anyone's mind will be changed. I'll bow out here, leaving my opinion that his conduct is hateful and inappropriate, and my opinion is if you're Caucasian you shouldn't have to accept that passively. Others may have other opinons or think it's okay - if so, we'll agree to disagree.

> That's not petty either. I don't really expect you to see it any other way. You too are part of the advantaged White race, and it's far easier to turn a blind eye to the advantages you receive over Black or Latino people than to recognize them and deal with the fact. Of course, you may actually recognize those advantages and just choose to deal with them differently than I do. I also see nothing wrong with that. I'…

Upvote this comment!!

Those of you who are downvoting it should be ashamed of yourselves. If you disagree, you should explain why, not use your privileged position to censor.

Re: Pity the Poor Couple Who Make $450,000 Per Year

#77

Post by alextingle »

ju2tin wrote: post #65

Lost in the bashing of this professor who had the temerity not to want to pay higher taxes, is the fact that he had to invest lots of money to be able to earn his big salary. He probably has at least 7 years of higher education. His wife, as a medical doctor, probably has at least 8, if I understand correctly how med school and internships work. They sank a huge amount of money -- maybe close to $500,000 -- into inve…

I think you're living in la-la land. If he had $500,000 to spend on education in the first place, then he started rich and just keeps getting richer. If he'd foregone the education and invested the $500k in something else, then he'd still be rich, and (presumably) he'd still feel hard done by.

Re: Pity the Poor Couple Who Make $450,000 Per Year

#78

Post by mchouza »

alextingle wrote: post #76
houseabsolute wrote: post #37

Earlier quoted context omitted.

> That's not petty either. I don't really expect you to see it any other way. You too are part of the advantaged White race, and it's far easier to turn a blind eye to the advantages you receive over Black or Latino people than to recognize them and deal with the fact. Of course, you may actually recognize those advantages and just choose to deal with them differently than I do. I also see nothing wrong with that. I'…

Upvote this comment!! Those of you who are downvoting it should be ashamed of yourselves. If you disagree, you should explain why, not use your privileged position to censor.

Downvoting is downvoting, it's not censorship.

Re: Pity the Poor Couple Who Make $450,000 Per Year

#79

Post by bhickey »

ryanwaggoner wrote: post #75
bhickey wrote: post #68

Earlier quoted context omitted.

Sure, but you're leaving out FICA (6.2%) and Medicare (1.45%). This bumps the brackets to 40.65% and 42.65% (or 43.65% and 47.25%). After local taxes this can easily top 50%. Suppose you earned $357k gross in Rhode Island. Your total tax liability would be in the area of $189k, or 52.7%. All of this also ignores the employer FICA contribution.

Can you break down your calculation a little? It's way higher than what I got...wondering if you forgot that these are marginal tax rates?

You're right. I bungled it up and didn't treat the rates as marginal.
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