Tax Season: Why I loathe paying taxes since moving to CA from the UK

Cobra is federal and was always a hack. We Americans need a complete healthcare rewrite, but there isn’t enough political will to get it done and we couldn’t even agree on what/how to change.

Cobra shifts all of the cost to the newly-unemployed employee, whereas previously the employer and employee shared the insurance premium cost and the employer side was tax deductible. It’s only more expensive than while employed because the person can’t deduct it from taxes, while the company could.

The parent of your comment mentioned Obamacare plans. Those plans (and Medicaid) require that you change your insurance policy, so depending on availability you may be able to keep your primary healthcare provider. The out-of-pocket costs vary depending on what you qualify for, but the change in employment allows you to move to a higher deductible plan (cheaper if you conserve your healthcare visits).

All US safety net programs assume the end user is a liar and/or thief so it is your responsibility to prove your need. The UK (and Germany and Japan) got to redesign their social contract in the rubble of WW2; the US didn’t. And WW2 was the reason we ended up with so much employer-sponsored healthcare —- which means being unemployed comes with losing healthcare. We would have far better job creation if employees were more willing to leave companies quickly rather than searching for the next job first or calculating how much Cobra runway they can afford.

I did think to add some caveats about the NHS, my sister works there so I'm aware of all the issues there. However, I would rather choose that system, over the one here, which is extremely expensive, and doesn't even look after you if you lose your insurance for whatever reason.

I think overall, I would say the UK has a lot of challenges, and if I was still living there, I would actually feel ok to pay more taxes to support those services, because I'd be using them.

As opposed to here, where I pay almost the same rate of taxes, and feel like I get nothing in return!

I am a bleeding heart liberal which doesn't come through in the below, but think this is one example of 'nothing as permanent as a temporary government measure'

Before 2012 the top CA tax bracket was the 9.3% one. CA was still one of the most progressive states (tax burden for mid-income folks and retirees is not bad, though cost of living is high), which means the state revenue is sensitive to the income of high-income Californians. Some of those incomes weren't doing so well in 2009-2011 with the GFC impact on tech, finance, maybe entertainment, execs living in the state, everyone's stock portfolios, etc.

Oh no, the schools are going to lose funding and the children won't be able to learn! Proposition 30 was proposed and raised sales tax for 4 years, and income tax for 7, via the creation of the 10.3-12.3 brackets; a 1M 1% surtax already existed. This was retroactive, raising taxes for the whole calendar year where it was on the November ballot.

https://en.wikipedia.org/wiki/2012_California_Proposition_30

Jerry Brown campaigned for it and stressed this was a temporary measure to get through these times, and it passed.

Four years later, in 2016... Did you know that if you don't act NOW then in a couple years there is going to be a big TAX CUT exclusively for rich Californians? Don't let this grave injustice happen, we need to fund schools so the children can learn! (and this time some other stuff like Medi-Cal and pay down the debt a bit).

https://en.wikipedia.org/wiki/2016_California_Proposition_55

I believe this makes them effective through 2030.

Next year, CA will lift the cap on the 1.1% CA employee payroll tax. I haven't followed this too close but think that means that californians making over $1M will be paying a 14.4% state marginal tax rate. Not that there's much sympathy for that group.

In 2025, the individual Tax Cuts and Jobs Act brackets will expire, with the top bracket going back up to 39.6%. Though I think Californians will be able to deduct their state taxes on the federal side once again (would not be surprised for that cap to return though).

I'm not necessarily opposed to these tax rates. I just wish having marginal rates over 50% would get us some form of universal healthcare.

Also worth pointing out that BART was originally planned to be a large loop around the entire South Bay, but the affluent suburbs in the lower peninsula rejected the plan to expand it to their neighborhoods.

Yay American NIMBYs! /s