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Started By
Message
Salary increase and new tax bracket
Posted on 3/14/14 at 11:29 pm
Posted on 3/14/14 at 11:29 pm
Previously in 28% tax bracket. Recently received raise and now in 33% tax bracket. All deductions identical from payroll.
Net pay is now less because of crossing threshold.
Should I go back to my previous salary?
Sorry if stupid question.
Net pay is now less because of crossing threshold.
Should I go back to my previous salary?
Sorry if stupid question.
8
Posted on 3/14/14 at 11:43 pm to green buddy
Glad you spent your 20th post on being productive.
I searched again and found it. Reading up on marginal tax rate.
Paycheck deductions look identical. Will look again to be sure.
Move along folks, nothing to see here.
Thanks in advance to anyone who posted in the thread from february on marginal taxation.
I searched again and found it. Reading up on marginal tax rate.
Paycheck deductions look identical. Will look again to be sure.
Move along folks, nothing to see here.
Thanks in advance to anyone who posted in the thread from february on marginal taxation.
Posted on 3/15/14 at 1:30 am to SomethingLikeA
quote:
Previously in 28% tax bracket. Recently received raise and now in 33% tax bracket. All deductions identical from payroll.
Net pay is now less because of crossing threshold.
Should I go back to my previous salary?
Sorry if stupid question.
Impossible for it to be less net pay. Yep, marginal tax rate is what matters. Your effective tax rate will also be higher.
This post was edited on 3/15/14 at 1:31 am
Posted on 3/15/14 at 9:18 am to SomethingLikeA
quote:no such thing as stupid questions, just stupid people asking questions
Sorry if stupid question.
Posted on 3/15/14 at 9:22 am to SomethingLikeA
You should ask your boss. He'll probably fix the problem.
Posted on 3/15/14 at 9:31 am to SomethingLikeA
quote:
Should I go back to my previous salary?
No, ask for a further decrease in pay.
quote:
just stupid people asking questions
Yes.
This post was edited on 3/15/14 at 9:31 am
Posted on 3/15/14 at 11:15 am to SomethingLikeA
Sublte brag thread is subtle.
Posted on 3/15/14 at 12:09 pm to SomethingLikeA
quote:
Should I go back to my previous salary?
No
The tax system is "tiered". There are certain thresholds that have different percentage rates. Once you pass a certain threshold, only the amount past that threshold gets taxed at that newer/higher rate.
For simplification, you're thinking that because you make more, that your ENTIRE income is now taxed at a new rate. This is FALSE.
Only the income for which you surpassed the threshold is taxed at a higher rate.
Federal Income Tax Rates
Posted on 3/15/14 at 4:48 pm to LSUSUPERSTAR
quote:If it really bragging to be in such a bracket and clueless about marginal rates? That's scary.
Sublte brag thread is subtle.
This post was edited on 3/15/14 at 4:52 pm
Posted on 3/16/14 at 9:18 am to SomethingLikeA
quote:
Previously in 28% tax bracket. Recently received raise and now in 33% tax bracket. All deductions identical from payroll.
Net pay is now less because of crossing threshold.
That would defy the laws of mathematics (assuming your HR people applied the brackets correctly).
Posted on 3/16/14 at 9:34 am to LSUSUPERSTAR
quote:
Subtle brag thread is subtle
No such thing as brag threads on the money board. There are people that make more money than you, get over it.
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