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by ceejayoz 1180 days ago
There aren't many Americans anywhere close to a 40-50% effective tax rate.
1 comments
AlbertCory 1180 days ago
California is easily close to that, when you add up Federal and State income taxes. As is New York.

Just look at the continued campaign to remove the $10,000 limit on State and Local Taxes. Where's that coming from?

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ceejayoz 1180 days ago
> California is easily close to that, when you add up Federal and State income taxes. As is New York.

No, it's not. Someone making $250k in California pays an effective Federal rate of 22% and state of 8%. Even someone making a million a year sees an effective rate of ~42%. (And that's before tax avoidance strategies they'll undoubtedly pursue.)

https://www.forbes.com/advisor/income-tax-calculator/califor...

Same thing for New York; $100k income nets out at a 20% effective rate. https://www.forbes.com/advisor/income-tax-calculator/new-yor...

(And these are single-filers. If you've got a family, it dips substantially further.)

> Just look at the continued campaign to remove the $10,000 limit on State and Local Taxes. Where's that coming from?

The $10k limit isn't a limit on taxes, it's on how much state/local tax paid you can deduct, set in 2017 as a way to punish high-tax blue states. https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act_of_2017

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AlbertCory 1180 days ago
> The $10k limit isn't a limit on taxes

Pedantic. Obviously that's what I meant (and knew)

Learn about marginal tax rates. See, Forbes even tells you: "your marginal tax rate is 35%"

22% is the average tax rate. It's the *marginal" tax rate we're concerned with for deductions.

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