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by flowerbeater 1769 days ago
The 37% and 13.3% are on marginal income, as I'm sure you know. The effective tax rate is much lower.

California and some other states also have required disability insurance that is taken out with the state income tax. It's 1% in CA.

And I would count Social Security and Medicare too, equally 7.65%. But the SS part has a cap so the percentage goes down the more you make.

All put together, someone making $250K pays about 37% on that to various income taxes listed above. If you were making 1M income a year, that rises to 47%. For 100K, it's about 30%.

1 comments

How much is also taxed on the employer payroll side?
The employer pays the same social security and medicare taxes as the employee and also has a cap on the social security part, plus in some cases an unemployment tax.

If you want to include employer taxes, to calculate if the employer wants to pay you 250K how much you would get, then it's be about 42%. At 100K, it'd be about 38% since you don't reach the SS cap.

Of course, there's a couple other tricks in there, like the government can embed some tax into the healthcare costs which are required for employers to buy, but then there's also deductions that are hard to turn into a percentage like this.