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Temporarily embarrassed millionaires pt. 2 (sh.itjust.works)
submitted 7 months ago by to c/politicalmemes@lemmy.world
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cross-posted from: https://sh.itjust.works/post/12805870

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[–] 112 points 7 months ago (13 children)

Just to be clear: with a marginal tax rate, if your income is $10,000,001, you pay $0.70 tax for the $1, and the rest of the $10,000,000 is taxed according to the lower tax brackets.

The first $50,000 of that $10 million is taxed just like the guy that only made $50,000.

The US tax system is slightly more complicated than this, but there's no situation where you can get stuck with a huge additional bill because you edged slightly into the next higher tax bracket.

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  • [–] 32 points 7 months ago (6 children)

    And we still hear people proudly saying they declined a raise that would put them in a higher tax bracket.

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  • [–] 29 points 7 months ago (2 children)

    That's because there are a lot of fucking idiots out there

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  • [–] 7 points 7 months ago

    To me, they're lying to push a narrative. No one's turning down a payrise because of that. Only stupid people who have never been offered that kind of money would ever make that kind of claim. So, I agree They're idiots. Just in a slightly different way.

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  • [–] 1 point 7 months ago* (last edited 7 months ago)

    It does depend a bit. The tax brackets are nonsense of course, but there are countries with allowance systems that don't fully decrease to zero as your income rises and at some point end in a hard cap. In those cases a raise might end up costing you due to losing the last part of an allowance.

    But that never withheld me from accepting a raise, you're going to have to push pass that threshold at some point anyway.

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  • [–] 4 points 7 months ago (1 child)

    I understand those who do it because they will lose super benefits because even worth q kid i don't qualify for food stamps and if i was making enough to qualify i might decline.

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  • [–] 8 points 7 months ago (3 children)

    Some dude I met who was previously working in Germany told me he came to Australia because tax was too high in Germany. He told me confidently that it was 40-something percent, flat tax when you earn over a certain amount. I queried if that was the top tax bracket and he told me no. I was shocked at high the marginal tax rate was based on that.

    Turns out, despite being a highly specialised metal machinist, he doesn't know shit, and Germany has tax brackets like everywhere else...

    People are astoundingly uninformed.

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  • [–] 4 points 7 months ago

    I know some Estonians working in Finland refuse raises because that puts them in the next tax bracket.

    But then those are mostly construction workers and the stereotypes for Estonians who go to Finland for construction work are... Eh, not flattering. Not saying there aren't smart people, but it's also a super common "career path" for people who drop out of school here in Estonia. Or used to be, anyway.

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