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forengjeng t1_ja8eetv wrote

How do you pay so little in taxes? If this is normal I can see why all public systems in the US are going to shit

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sea_dev OP t1_ja8j7yg wrote

That's just how progressive tax brackets work. For example, the 2022 brackets for married filing jointly are:

  • 10% on income up to $20,550
  • $2,055 + 12% on excess income up to $83,550
  • $9,615 + 22% on excess income up to $178,150
  • $30,427 + 24% on excess income up to $340,100
  • $69,295 + 32% on excess income up to $431,900
  • $98,671 + 35% on excess income up to $647,850
  • $174,253.50 + 37% on excess income

So for 2022 my taxable income was $278,077 and I only took the standard deduction of $25,900. I also had 401k contributions throughout the year, but I hadn't included any of those for previous years "total income" figures in the graph. So my federal income tax that I owed was $54,409 ($30,427+0.24*[278,077-178,150]). But I got to claim $6,000 with the child tax credit, reducing that to $49,055 (nearly a 10% reduction).

Also, our government subsidizes married couples and families. Married filing jointly tax brackets are much lower than individuals and the child tax credits don't start to fall off until I think around $400,000 household income.

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pulchritudinouser t1_ja941b4 wrote

I’m single with no kids living in a state with super high taxes , my tax rate would make you cry

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derfury t1_ja8lbr3 wrote

Yup my tax rate is more than double at every sample in this graph lol (I’m in Canada)

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paleofagua t1_jab0qwm wrote

I wonder if he’s only considering the federal income tax in his “effective” tax rate. There are others outside those included in that bracket like state and FICA.

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