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That story about the secretary? That is completely contrary to the way a marginal income tax actually works. There is no way, in the American progressive tax s
by encoderer 17y ago
That story about the secretary? That is completely contrary to the way a marginal income tax actually works.
There is no way, in the American progressive tax system, to get a raise, be moved into a higher tax bracket, and end up taking home less money. It's just not possible.
@ryanwaggoner - correct, ty.
- ryanwaggoner 17y agoActually, it's contrary to the way a marginal income tax works.
- SamAtt 17y agoIt can if you combine a marginal Federal Tax with a State Flat Tax. Not all tax systems are progressive
- encoderer 17y agoOk, I'll bite... How? A state flat tax will tax this new raise at the same flat rate as all the existing pay. The marginal federal tax will tax the new raise, in your scenario, at the new, higher tax bracket. But your scenario would have the gov't taxing this new cash into the red, reducing her take home pay. That's not gonna happen. Period.