| > What state are you in? California. > After CA income tax, etc etc effective tax rate is easily 40%+. The marginal rate is that high yes. Pretty easy breakdown at 200k: CA Disability: 0.00% (phased out at $114k)
Social Security: 0.00% (phased out at $128k)
Medicare/Medicaid: 2.35%
California Tax: 9.30%
Federal Tax: 32.00% So that's around 40 percent of every _extra_ dollar, emphasis on "extra". The average rate rate is far lower, around 18% federal, 9% cali. > My experience is more similar to the parent post; bonuses which are part of your total comp get taxed slightly higher than base pay. Your experience with bonuses is misleading. They're taxed as normal income, but the withholding formulas for paychecks are calculated independently per paycheck, as if you earned that much every paycheck. So if you have one biweekly paycheck with a 15 percent of salary bonus, that's taxed as if you made 5x as much. End result: you are withheld as though in the top tax bracket for the bonus paycheck, and your refund will be larger than expected. tl;dr: don't look at your pay stubs, look at the actual tax returns you file instead for effective tax rates. |