tax bracket

[sosoo]

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hi, its that time of year when i have boosted interest in taxes..
i wonder if anyone knows in the 28% tax bracket (or 25%, whichever one belongs), is that all inclusive of:
-FED Withholding
-FED MED/EE
-FED OASDI/EE ??

OR is the 28% tax a person owes just the FED withholding?

 

[awval999]

A person only owes 28% federal tax on the taxable (NOT gross) income > 90,751 (single) or > 151,201 (MFJ).

It seems that you don't understand marginal tax brackets from the question. (No worries, many don't).

The Medicare + OASDI (Social Security) = FICA taxes are IN ADDITION to federal taxes.

Edit: Explanation of marginal tax brackets
http://www.investopedia.com/ask/answers/05/marginaltaxrate.asp

 

[Dred Pirate]

A person only owes 28% federal tax on the taxable (NOT gross) income > 90,751 (single) or > 151,201 (MFJ).

It seems that you don't understand marginal tax brackets from the question. (No worries, many don't).

The Medicare + OASDI (Social Security) = FICA taxes are IN ADDITION to federal taxes.

I am not piling on the OP - but I am amazed at how many people don't get the marginal tax bracket statement. I explain this many times each year to both techs and Rph's, Especially when it comes to OT and how "the government took half of my OT - it is not worth it" then explaining to them the tax table withholdings, etc.... (although the OT statement is not exactly marginal tax bracket info)

and actually they wouldn't owe 28% on the taxable income, only the amount in that particular income range (I am too lazy to look it up). Some of the money is taxed at 0, some at 10%, etc.

Another argument why financial literacy 101 should be a requirement in high school

 

[owlegrad]

For years I thought you could lose money by being bumped up in the tax brackets. I think SDN is where I learned otherwise, lol

So thanks again SDN!

 

[RimzyA]

For years I thought you could lose money by being bumped up in the tax brackets. I think SDN is where I learned otherwise, lol

So thanks again SDN!

Could you explain the OT tax bracket?

 

[ChalupaBatman86]

Could you explain the OT tax bracket?

The government takes 50% of it and uses it to buy Obama phones for crack fiends because Fox News. I hope this question is a joke, god help us.

 

[RimzyA]

The government takes 50% of it and uses it to buy Obama phones for crack fiends because Fox News. I hope this question is a joke, god help us.

I am not an American, I moved here for college, so no this question is not a joke... Its strange how people get hoity toity over knowledge. You know something, and I ask if you could share and your response is to insult me...

 

[pezdispenser]

Could you explain the OT tax bracket?

If you pick up enough OT to earn over $7,400 on a biweekly paycheck, your employer will start withholding taxes at the 33% tax bracket on any amount over $7,400. This is because $7,400 x 26 = $192,400 annually, which is where the 33% tax bracket begins. However, if you don't make this much on every paycheck and your annual total ends up below $192,400, you will actually only be in the 28% tax bracket so that extra tax withheld will be refunded to you on your tax return.

On a different point, they actually stop withholding 6.2% Social Security once you hit the max of $118,500 per calendar year. So towards the end of the year, especially with OT, your taxes will actually decrease, and your take-home pay will go up.

 

[Dred Pirate]

I might actually hit that the social security max this year (I hope!!!) I'll have to double check with this pay check (changed jobs midway in year and not sure what the exact amount I made at my first job was)

just an FYI - they will still withhold it from your paycheck because only if it is made at one employer will they quit withholding, but it will be refunded to you when you file

 

[Dred Pirate]

I kinda figured!! Oh well. Money back is money.

same thing if you moonlight - although that usually helps because the second job always under witholds

 

[SouthernRetailRPH]

It's always my favorite time of the year when I pass the SS max and my pay goes up, unfortunately I took about a month off after my son was born this year so I didn't hit it until December

 

[group_theory]

There's also the Additional Medicare Tax (0.9%) applied if your income is above a certain threshold (part of the ACA/Obamacare)

https://www.irs.gov/Businesses/Smal...s-and-Answers-for-the-Additional-Medicare-Tax

 

[mxh2340]

Due to high tax income bracket, I recently start a home based business for tax deduction . Hopefully, I will get more money back next year

 

[mxh2340]

🙂

 

[Momus]

If you are interested in this home based business, please email me
.......

Sounds like a scam. Stay away.

 

[sosoo]

home business for tax deduction is basically to scam the gov't. long ago i did a home business doing sales that i never sold anything for tax deductions purpose. but the one i selected had a high annual membership fee, and monthly purchase, so i didn't gain much and had to quit. but there are other home base business u can do to get tax deductions.

 

[confettiflyer]

home business for tax deduction is basically to scam the gov't. long ago i did a home business doing sales that i never sold anything for tax deductions purpose. but the one i selected had a high annual membership fee, and monthly purchase, so i didn't gain much and had to quit. but there are other home base business u can do to get tax deductions.

You don't need to join anything or pay annual membership fees to start a business. You can literally just go, "I'm going to start a business." and do whatever.

Until the government can read minds, there's no way to differentiate a legitimate attempt to earn profit vs. a business started with the intent to lower taxable income through losses.


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