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If you move to CA, you need to pay state tax on your entire earnings, not just your raise. 13.3% of 140k is more than 18k, which is certainly significant.
by jrm415 10y ago
If you move to CA, you need to pay state tax on your entire earnings, not just your raise. 13.3% of 140k is more than 18k, which is certainly significant.
- ammon 10y agoYou're totally correct and I am wrong :)
- wwweston 10y agoWait -- is the assertion here that California state tax rates aren't marginal? Because I don't think that's true.
- jrm415 10y agoCA taxes are marginal. My math was overly simplistic, because I only wanted to illustrate that you needed to pay CA taxes on your full salary.
- snovv_crash 10y agoThe difference is that WA doesn't have state income tax.
- EdJiang 10y agoI believe you can deduct state from federal tax, which would save ~2.5% in marginal tax. In addition, social security phases out at ~120k so that's another 7.5% savings. So the difference is almost a wash if I understand correctly?
- seattlefreeze 10y agoDon't forget about AMT. That usually throws a wrench in things. https://en.wikipedia.org/wiki/Alternative_minimum_tax https://en.wikipedia.org/wiki/Alternative_minimum_tax
- valleyer 10y agoCorrect. Specifically, it disallows deduction of state/local taxes from your federal taxable income.