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100% exempt does feel high to me. I think my main problem w/ the tax proposals is that they are big, bold changes. If anyone wants to increases taxes even 1%,

100% exempt does feel high to me. I think my main problem w/ the tax proposals is that they are big, bold changes. If anyone wants to increases taxes even 1%, I want there to be a big fight about it. Serious demands in to budget efficiency and transparency. If it passes, I want to know there is scrutiny over the taking of my dollars. Passing a 10% increase swiftly and suddenly is like a punch to the gut, and we all know the tax code and laws around equity are totally moronic. "We only tax if you make over $x!" doesn't account for the fact that many folks get all of their many years of equity... at once, in one tax year. Why is that counted as income for 1 year, and then boom, up to 65% tax? Overall, taxes over 50% feel unethical too -- imagine if a mob boss goes to a retail store and demands half the profits. Why does anyone -- mob or Government -- deserve more than half of what you make? To hit 55% tax rate in California after this, you only need to make like $250k total. It's a good amount, sure, but if you compare cost of living... it's still hard to live on. You can still barely afford a crappy house. So you get this situation where "life is hard" AND the government is taking home more of your money than you do.

VictorPath 5y ago
> imagine if a mob boss goes to a retail store and demands half the profits. Why does anyone -- mob or Government -- deserve more than half of what you make? I work and create wealth, and some heirs swoop in and grab that created wealth for themselves in the form of quarterly dividends. Sounds like exactly what you are describing. The parasitic expropriation of my surplus labor time by an aristocracy of heirs.
- imgabe 5y ago
  This isn’t about estate tax. Your heirs don’t take anything away from you, neither does the government with estate tax. At the time they take whatever they’re taking, you are dead. Dead people have no use for property. Besides that, if you don’t want your heirs to have your estate, you can create a will while you’re alive and leave all your property to charity, your cat, whatever. In any event, whatever happens to your wealth it won’t really matter to you, since you’ll be dead. Edit: seems I misread this. Anyway, nobody “expropriated“ your labor, you sold it at an agreed upon price. If you aren’t happy with the price you got, demand more or make your labor more valuable.
  - wavefunction 5y ago
    It doesn't seem that the OP is referring to their own heirs.
  - thrav 5y ago
    They’re talking about corporate profits being funneled to already wealthy shareholders instead of the people responsible for generating the profits.
nerdponx 5y ago
Ok, but then tax cuts need similar detailed scrutiny. What will have to be cut, and who will suffer by how much as a result?
HWR_14 5y ago
> Overall, taxes over 50% feel unethical too -- imagine if a mob boss goes to a retail store and demands half the profits. Why does anyone -- mob or Government -- deserve more than half of what you make? 50% is just a random number that feels good to you. I have a different question - what can you possibly do that justifies making $100 MM a year? Getting to keep even $45 MM seems mighty generous of society. (Obviously given the current value of the dollar.) >To hit 55% tax rate in California after this Thanks to a graduated income tax, hitting the 55% rate is no the same as getting taxed at 55%. And this only applies to one narrow source of income.
- ridruejo 5y ago
  “ what can you possibly do that justifies making $100 MM a year?” That’s not up to you to decide in a free society. Market determines that.
  - count 5y ago
    In the real world, the government, as a representative of society, is a part of the market. You're thinking of the spherical cow of economics.
    - grapist420 5y ago
      you don’t want pharmaceutical plant workers and accountants voting on whether the company should invest in mRNA tech in 2013?
      - HWR_14 5y ago
        I honestly don't understand your comment. Are you saying they should have voted? Should not have? I have no idea what you are alluding to.
  - analognoise 5y ago
    What a myth! That the markets are free. There are a lot of levers we can pull as a society, and we're pulling this one (finally). We create market conditions. It isn't some uncontrollable god we all have to live with.
frellus 5y ago
As a founding member of a startup I can say that to early exercise using QSBS while the capitalization of the company is <50M is to take a huge risk. If the company folds, my stock is worth $0 and I lose. It's a gamble. Why does the government get to take money from me, risk free, when I'm the one taking the risks and starting a company which, if successful and grows, will employ many people? Is it fair to pay on an unrealized gain, such as with certain option exercises where you have to pay AMT without first selling? All risk to me, none to the government. They're like mobsters who shake you down, rich or poor. Eliminating QSBS will be the death of Silicon Valley. Raising capital gains will likewise kill incentive to build businesses and invest. It's insanity, pure insanity. There is no avenue the Democrats are leaving un-pursued in their quest to raise taxes. Insanity in this economy. Insanity.
- iaw 5y ago
  > Eliminating QSBS will be the death of Silicon Valley. Silicon valley existed before QSBS it can survive it's removal.
- mbesto 5y ago
  > Why does the government get to take money from me, risk free, when I'm the one taking the risks and starting a company which, if successful and grows, will employ many people? Why do you get to use the internet my tax dollars paid for? That same internet that your startup so heavily requires to function, heck, even exist?
  - grapist420 5y ago
    okay but the adage of “VC profit is mostly the huge winners”, so your marginal benefit goes down only at the highest valuation companies, and does that really harm much? There’s a great argument that yes, I’d rather have Elon be able to pump billions into spaceX or bezos billions into his ventures than have poor people spend them, but incentives? No clue, genuinely
- johnrgrace 5y ago
  I think you've forgotten that with a company you've been given some amazing legal rights by the goverment. If the company goes bankrupt you as founder don't personally have to pay off the debits you get to walk away.
harry8 5y ago
>Overall, taxes over 50% feel unethical too Wait until you hear about Apple's turnover tax! F.you(pay them) even when you're losing money!
barbazoo 5y ago
> To hit 55% tax rate in California after this, you only need to make like $250k total. It's a good amount, sure, but if you compare cost of living... it's still hard to live on. Excuse my ignorance but would you be able to lay out basically how this amount of money is hard to live on?
- snicker7 5y ago
  Yachts are expensive. And it’s literally impossible to live in Cali without one. What would the neighbors think?
  - ch4s3 5y ago
    You’d be hard pressed to buy a 2 bedroom condo in most of California with that income. The places that pay that much have the most expensive housing in the US.
- dmitrygr 5y ago
  Rents for a small apartment can be around 3000/month. Food in the area is quite expensive. So are things like car maintenance, movie theatres, gasoline, etc. If you live in SF, you'll need to budget 2-3 car break-ins per month and 1-2 catalytic converter thefts per year to deal with. On top of that, CA has a quite high income tax. It adds up fast...
- onlyrealcuzzo 5y ago
  Renting a nice 1bdrm apartment in a decent neighborhood in SF or LA is going to cost you over $48k per year. Probably closer to $60k. That's close $100k+ pre-tax. Even with a modest spending budget, if you want to max your 401k - which you will need to do to keep this life style in retirement - you're going to need to make $180k. Definitely not "hard to live on". But also, you are decidedly far from rich. $250k - if you are single - you should be able to save a lot and make some investments and have more financial freedom - or more spending, whichever you prefer. Still, you are far from "rich". Even at ~$450k (top 1%), you're going to need several years of savings at that level before you start to feel "rich". Should people feel sorry for you? No. But are you just riding around on yachts and drinking umbrella drinks all day? No.
jimbob45 5y ago
https://en.m.wikipedia.org/wiki/Door-in-the-face_technique https://en.m.wikipedia.org/wiki/Door-in-the-face_technique This is classic DITF. Spring 10% on everyone and then claim to have “listened to the people” by later rolling it back to 1%.
chrononaut 5y ago
> If anyone wants to increases taxes even 1%, I want there to be a big fight about it. Serious demands in to budget efficiency and transparency. If it passes, I want to know there is scrutiny over the taking of my dollars. One can imagine it should apply for both increases and decreases. "What programs will no longer be funded and why?", etc
timcederman 5y ago
How do you hit 55% tax rate in California after this?
presentation 5y ago
The US government doesn’t need your money to fund its programs, it can always fund by printing money. Tax policy is more about shaping behavior and preventing inflation, and as such these taxes ought not be judged on what they’re “paying for.”
TaylorAlexander 5y ago
> Why does anyone -- mob or Government -- deserve more than half of what you make? The best argument is that policy like this has nothing to do with what individuals deserve. The idea is that people got rich in part due to all the nice infrastructure we have, and so we could tax some of the income they made off that infrastructure to pay for it all. This includes everything from bridges and buses to food stamps and free clinics - all the things that helped make getting rich possible. Anyway I'm an anarchist and I would rather have workers in control of the means of production so no individuals get to take all the profits from collective endeavors for themselves, but if we're going to have a state that taxes folks, the argument above is the one I think is best. Also others mentioned this but hitting the 55% tax rate at $250k means every dollar over $250k is taxed at 55%, but it does not mean that person pays 55% of their income as tax.
- sbacic 5y ago
  > The idea is that people got rich in part due to all the nice infrastructure we have, and so we could tax some of the income they made off that infrastructure to pay for it all. This sounds solid until you realize that country B next door has lower taxes, better public services or in some cases - both. Does the GP question make sense then?
  - taurath 5y ago
    And is less privatized for those public services, and doesn’t spend 5x what the rest of the word spends on a military industrial complex, and makes a lot of government income on natural resources.
    - sbacic 5y ago
      I intentionally didn't want to name countries because this isn't about Canada or the US - it's a global issue and taxes (sadly) do not correlate to the level of public services.
      - taurath 5y ago
fartingflamingo 5y ago
I certainly and sincerely agree with you about demands for budget efficiency and transparency. > [...] you only need to make like $250k total. It's a good amount, sure, but if you compare cost of living... it's still hard to live on. This reminds me of the famous "Let them eat cake" [0] by queen Marie-Antoinette. A statistical point of comparison. California median gross individual income is under $64k, or $78k [1] household income. "Easy to live on" scales superlinearly from there, so by significantly more than 3.2 or 3.9 times respectively. Two anecdotal points of comparison. I enjoy a comfortable life on 1/6 of that threshold amount pre-tax, albeit in a HCOL western European city. My marginal tax rate is... 53.5%, not including real estate ownership tax, and some other minor taxation. And though it may surprise you, friends of mine living in the very LCOL eastern European countryside live on a 6k€ pretax income. 6k€ a year that is. With a family of four, soon five. They consider their living conditions comfortable and wouldn't want to change them for the world. Do mind this is 40 times less than the "hard to live on". A recommendation Please grow your awareness of the material situation of others. Being more anchored in reality will benefit you. [0] https://en.wikipedia.org/wiki/Let_them_eat_cake https://en.wikipedia.org/wiki/Let_them_eat_cake [1] https://fred.stlouisfed.org/series/MEHOINUSCAA646N https://fred.stlouisfed.org/series/MEHOINUSCAA646N
- qaq 5y ago
  This is meaningless comparison I am originally from Ukraine 30K USD per year there buys you same lifestyle as 200+K in CA. So just comparing amounts is totally meaningless.
- flyinglizard 5y ago
  I wish you to one day have the perspective to understand other people may have different wants and needs than you and that it is fine. It doesn’t put them in any moral or social predicament.
Barrin92 5y ago
> To hit 55% tax rate in California after this, you only need to make like $250k total If you make 250k as an individual you're in the 97th percentile in the state, 91th for a household. If that's impossible to live on how do the 90% below you survive? It's literally four times the median wage in the state. Also another perspective from across the pond, I hit the maximum marginal income tax rate at 57k. Of my 85k paycheck I pay a little less than half effectively in taxes and social contributions so this discussion is like another world to me https://dqydj.com/income-percentile-by-state-calculator/ https://dqydj.com/income-percentile-by-state-calculator/
- pembrook 5y ago
  Comparing salaries to all of California is an irrelevant data point. Most Californians don’t live in the Bay Area, where basic housing costs $1.5M Can a family of 4 live on $250k in the Bay Area? Of course. But you’ll never own a home. And working for the wealthiest companies in the world doing the most in-demand job in the world, yet never being able to own a home, that’s a bizarre situation to be in. We want to incentivize more people to work in tech. Not less. Whatever you get paid in Europe is irrelevant since it’s a completely different system (from healthcare and education down to public transport and housing). And if Europe wants to be at all competitive with the US or China in tech (right now, it’s not), maybe you should be getting paid more than a mid-level accountant?
  - snewman 5y ago
    The problem here is not taxation, it's the artificially constrained housing supply in the Bay Area. Too many people are chasing too few houses; they would remain unaffordable to most even if the tax rate were zero, because prices would rise to match income.
    - pembrook 5y ago
      Fully agree, it's a housing supply issue. But raising taxes while not addressing the supply problem will make it worse for those who have not already "cashed out" their capital gains into tax-advantaged real estate.
dbt00 5y ago
> To hit 55% tax rate in California after this, you only need to make like $250k total. Marginal rate, effective rate not even close.
- Applejinx 5y ago
  People so often performatively misunderstand this, that I'm getting to where I think we should literally skip having marginal rates and just abruptly switch the actual rate over at that threshold. I mean, if that is how they are going to act, let's just do it. Nothing is apparently gained through having marginal rates be the reality. We are just leaving money on the table when the collective insistence of people for decades is that marginal taxes don't exist and the rate's just abruptly hiked to a different one. So fine. Marginal rates don't exist, then. Happy?
rsynnott 5y ago
> you only need to make like $250k total. hackernews.txt > AND the government is taking home more of your money than you do. No it isn't. The government is taking more than half of the money that you _make at the marginal rate_. You'd want to be earning a lot more than that to have >50% total.
- disgruntledphd2 5y ago
  Yeah, I hit the highest marginal rate at about a third of my income, and yet I still only pay approximately one third of my gross as tax yearly.
pjc50 5y ago
> If anyone wants to increases taxes even 1%, I want there to be a big fight about it. Serious demands in to budget efficiency and transparency. If it passes, I want to know there is scrutiny over the taking of my dollars. > Passing a 10% increase swiftly and suddenly is like a punch to the gut The problem is that there have been decades of unserious scrutiny. Every percent is fought over regardless of what the underlying details might be. So what you get is a situation where only "big bang" changes happen, because once the politics manages to break the deadlock, why waste that narrow change window on 1%?
imtringued 5y ago
I find it interesting how people stopped caring about everything except housing. It's like humans have succeeded at almost everything except one thing and then people tell you that their basic needs aren't met as if the rest of their life is just as bad when it's the opposite. People want housing to be exclusive and they want you to get the hell out of their hometown.
flerchin 5y ago
Do income spreading if having an unusual year. This spreads your income across the past several years, and allows a lower marginal tax-rate.
- chromatin 5y ago
  Do you mean exercise of options and sales of shares? Because otherwise this strategy is only available to the business owner(s). Thx, tax strategy newbie.
  - flerchin 5y ago
    I don't know where you get that idea. I mean income spreading, and it's available to individuals. Leave your personal attacks on another forum please. https://www.investopedia.com/terms/i/incomespreading.asp https://www.investopedia.com/terms/i/incomespreading.asp
    - chromatin 5y ago
      > Leave your personal attacks on another forum please. what?
micromacrofoot 5y ago
You're damned if you do and damned if you don't. If you raise taxes 10% you won't be able to touch them again for 10+ years because everyone will say "but you JUST raised taxes" — I've seen this happen locally. Bold suggestions tend to happen because they either get negotiated down and/or it's the only chance you get for quite some time.

VictorPath 5y ago

> imagine if a mob boss goes to a retail store and demands half the profits. Why does anyone -- mob or Government -- deserve more than half of what you make? I work and create wealth, and some heirs swoop in and grab that created wealth for themselves in the form of quarterly dividends. Sounds like exactly what you are describing. The parasitic expropriation of my surplus labor time by an aristocracy of heirs.

imgabe 5y ago
This isn’t about estate tax. Your heirs don’t take anything away from you, neither does the government with estate tax. At the time they take whatever they’re taking, you are dead. Dead people have no use for property. Besides that, if you don’t want your heirs to have your estate, you can create a will while you’re alive and leave all your property to charity, your cat, whatever. In any event, whatever happens to your wealth it won’t really matter to you, since you’ll be dead. Edit: seems I misread this. Anyway, nobody “expropriated“ your labor, you sold it at an agreed upon price. If you aren’t happy with the price you got, demand more or make your labor more valuable.
- wavefunction 5y ago
  It doesn't seem that the OP is referring to their own heirs.
- thrav 5y ago
  They’re talking about corporate profits being funneled to already wealthy shareholders instead of the people responsible for generating the profits.

nerdponx 5y ago

Ok, but then tax cuts need similar detailed scrutiny. What will have to be cut, and who will suffer by how much as a result?

HWR_14 5y ago

> Overall, taxes over 50% feel unethical too -- imagine if a mob boss goes to a retail store and demands half the profits. Why does anyone -- mob or Government -- deserve more than half of what you make? 50% is just a random number that feels good to you. I have a different question - what can you possibly do that justifies making $100 MM a year? Getting to keep even $45 MM seems mighty generous of society. (Obviously given the current value of the dollar.) >To hit 55% tax rate in California after this Thanks to a graduated income tax, hitting the 55% rate is no the same as getting taxed at 55%. And this only applies to one narrow source of income.

ridruejo 5y ago
“ what can you possibly do that justifies making $100 MM a year?” That’s not up to you to decide in a free society. Market determines that.
- count 5y ago
  In the real world, the government, as a representative of society, is a part of the market. You're thinking of the spherical cow of economics.
  - grapist420 5y ago
    you don’t want pharmaceutical plant workers and accountants voting on whether the company should invest in mRNA tech in 2013?
    - HWR_14 5y ago
      I honestly don't understand your comment. Are you saying they should have voted? Should not have? I have no idea what you are alluding to.
- analognoise 5y ago
  What a myth! That the markets are free. There are a lot of levers we can pull as a society, and we're pulling this one (finally). We create market conditions. It isn't some uncontrollable god we all have to live with.

frellus 5y ago

As a founding member of a startup I can say that to early exercise using QSBS while the capitalization of the company is <50M is to take a huge risk. If the company folds, my stock is worth $0 and I lose. It's a gamble. Why does the government get to take money from me, risk free, when I'm the one taking the risks and starting a company which, if successful and grows, will employ many people? Is it fair to pay on an unrealized gain, such as with certain option exercises where you have to pay AMT without first selling? All risk to me, none to the government. They're like mobsters who shake you down, rich or poor. Eliminating QSBS will be the death of Silicon Valley. Raising capital gains will likewise kill incentive to build businesses and invest. It's insanity, pure insanity. There is no avenue the Democrats are leaving un-pursued in their quest to raise taxes. Insanity in this economy. Insanity.

iaw 5y ago
> Eliminating QSBS will be the death of Silicon Valley. Silicon valley existed before QSBS it can survive it's removal.
mbesto 5y ago
> Why does the government get to take money from me, risk free, when I'm the one taking the risks and starting a company which, if successful and grows, will employ many people? Why do you get to use the internet my tax dollars paid for? That same internet that your startup so heavily requires to function, heck, even exist?
- grapist420 5y ago
  okay but the adage of “VC profit is mostly the huge winners”, so your marginal benefit goes down only at the highest valuation companies, and does that really harm much? There’s a great argument that yes, I’d rather have Elon be able to pump billions into spaceX or bezos billions into his ventures than have poor people spend them, but incentives? No clue, genuinely
johnrgrace 5y ago
I think you've forgotten that with a company you've been given some amazing legal rights by the goverment. If the company goes bankrupt you as founder don't personally have to pay off the debits you get to walk away.

harry8 5y ago

>Overall, taxes over 50% feel unethical too Wait until you hear about Apple's turnover tax! F.you(pay them) even when you're losing money!

barbazoo 5y ago

> To hit 55% tax rate in California after this, you only need to make like $250k total. It's a good amount, sure, but if you compare cost of living... it's still hard to live on. Excuse my ignorance but would you be able to lay out basically how this amount of money is hard to live on?

snicker7 5y ago
Yachts are expensive. And it’s literally impossible to live in Cali without one. What would the neighbors think?
- ch4s3 5y ago
  You’d be hard pressed to buy a 2 bedroom condo in most of California with that income. The places that pay that much have the most expensive housing in the US.
dmitrygr 5y ago
Rents for a small apartment can be around 3000/month. Food in the area is quite expensive. So are things like car maintenance, movie theatres, gasoline, etc. If you live in SF, you'll need to budget 2-3 car break-ins per month and 1-2 catalytic converter thefts per year to deal with. On top of that, CA has a quite high income tax. It adds up fast...
onlyrealcuzzo 5y ago
Renting a nice 1bdrm apartment in a decent neighborhood in SF or LA is going to cost you over $48k per year. Probably closer to $60k. That's close $100k+ pre-tax. Even with a modest spending budget, if you want to max your 401k - which you will need to do to keep this life style in retirement - you're going to need to make $180k. Definitely not "hard to live on". But also, you are decidedly far from rich. $250k - if you are single - you should be able to save a lot and make some investments and have more financial freedom - or more spending, whichever you prefer. Still, you are far from "rich". Even at ~$450k (top 1%), you're going to need several years of savings at that level before you start to feel "rich". Should people feel sorry for you? No. But are you just riding around on yachts and drinking umbrella drinks all day? No.

jimbob45 5y ago

https://en.m.wikipedia.org/wiki/Door-in-the-face_technique https://en.m.wikipedia.org/wiki/Door-in-the-face_technique This is classic DITF. Spring 10% on everyone and then claim to have “listened to the people” by later rolling it back to 1%.

chrononaut 5y ago

> If anyone wants to increases taxes even 1%, I want there to be a big fight about it. Serious demands in to budget efficiency and transparency. If it passes, I want to know there is scrutiny over the taking of my dollars. One can imagine it should apply for both increases and decreases. "What programs will no longer be funded and why?", etc

timcederman 5y ago

How do you hit 55% tax rate in California after this?

presentation 5y ago

The US government doesn’t need your money to fund its programs, it can always fund by printing money. Tax policy is more about shaping behavior and preventing inflation, and as such these taxes ought not be judged on what they’re “paying for.”

TaylorAlexander 5y ago

> Why does anyone -- mob or Government -- deserve more than half of what you make? The best argument is that policy like this has nothing to do with what individuals deserve. The idea is that people got rich in part due to all the nice infrastructure we have, and so we could tax some of the income they made off that infrastructure to pay for it all. This includes everything from bridges and buses to food stamps and free clinics - all the things that helped make getting rich possible. Anyway I'm an anarchist and I would rather have workers in control of the means of production so no individuals get to take all the profits from collective endeavors for themselves, but if we're going to have a state that taxes folks, the argument above is the one I think is best. Also others mentioned this but hitting the 55% tax rate at $250k means every dollar over $250k is taxed at 55%, but it does not mean that person pays 55% of their income as tax.

sbacic 5y ago
> The idea is that people got rich in part due to all the nice infrastructure we have, and so we could tax some of the income they made off that infrastructure to pay for it all. This sounds solid until you realize that country B next door has lower taxes, better public services or in some cases - both. Does the GP question make sense then?
- taurath 5y ago
  And is less privatized for those public services, and doesn’t spend 5x what the rest of the word spends on a military industrial complex, and makes a lot of government income on natural resources.
  - sbacic 5y ago
    I intentionally didn't want to name countries because this isn't about Canada or the US - it's a global issue and taxes (sadly) do not correlate to the level of public services.
    - taurath 5y ago

fartingflamingo 5y ago

I certainly and sincerely agree with you about demands for budget efficiency and transparency. > [...] you only need to make like $250k total. It's a good amount, sure, but if you compare cost of living... it's still hard to live on. This reminds me of the famous "Let them eat cake" [0] by queen Marie-Antoinette. A statistical point of comparison. California median gross individual income is under $64k, or $78k [1] household income. "Easy to live on" scales superlinearly from there, so by significantly more than 3.2 or 3.9 times respectively. Two anecdotal points of comparison. I enjoy a comfortable life on 1/6 of that threshold amount pre-tax, albeit in a HCOL western European city. My marginal tax rate is... 53.5%, not including real estate ownership tax, and some other minor taxation. And though it may surprise you, friends of mine living in the very LCOL eastern European countryside live on a 6k€ pretax income. 6k€ a year that is. With a family of four, soon five. They consider their living conditions comfortable and wouldn't want to change them for the world. Do mind this is 40 times less than the "hard to live on". A recommendation Please grow your awareness of the material situation of others. Being more anchored in reality will benefit you. [0] https://en.wikipedia.org/wiki/Let_them_eat_cake https://en.wikipedia.org/wiki/Let_them_eat_cake [1] https://fred.stlouisfed.org/series/MEHOINUSCAA646N https://fred.stlouisfed.org/series/MEHOINUSCAA646N

qaq 5y ago
This is meaningless comparison I am originally from Ukraine 30K USD per year there buys you same lifestyle as 200+K in CA. So just comparing amounts is totally meaningless.
flyinglizard 5y ago
I wish you to one day have the perspective to understand other people may have different wants and needs than you and that it is fine. It doesn’t put them in any moral or social predicament.

Barrin92 5y ago

> To hit 55% tax rate in California after this, you only need to make like $250k total If you make 250k as an individual you're in the 97th percentile in the state, 91th for a household. If that's impossible to live on how do the 90% below you survive? It's literally four times the median wage in the state. Also another perspective from across the pond, I hit the maximum marginal income tax rate at 57k. Of my 85k paycheck I pay a little less than half effectively in taxes and social contributions so this discussion is like another world to me https://dqydj.com/income-percentile-by-state-calculator/ https://dqydj.com/income-percentile-by-state-calculator/

pembrook 5y ago
Comparing salaries to all of California is an irrelevant data point. Most Californians don’t live in the Bay Area, where basic housing costs $1.5M Can a family of 4 live on $250k in the Bay Area? Of course. But you’ll never own a home. And working for the wealthiest companies in the world doing the most in-demand job in the world, yet never being able to own a home, that’s a bizarre situation to be in. We want to incentivize more people to work in tech. Not less. Whatever you get paid in Europe is irrelevant since it’s a completely different system (from healthcare and education down to public transport and housing). And if Europe wants to be at all competitive with the US or China in tech (right now, it’s not), maybe you should be getting paid more than a mid-level accountant?
- snewman 5y ago
  The problem here is not taxation, it's the artificially constrained housing supply in the Bay Area. Too many people are chasing too few houses; they would remain unaffordable to most even if the tax rate were zero, because prices would rise to match income.
  - pembrook 5y ago
    Fully agree, it's a housing supply issue. But raising taxes while not addressing the supply problem will make it worse for those who have not already "cashed out" their capital gains into tax-advantaged real estate.

dbt00 5y ago

> To hit 55% tax rate in California after this, you only need to make like $250k total. Marginal rate, effective rate not even close.

Applejinx 5y ago
People so often performatively misunderstand this, that I'm getting to where I think we should literally skip having marginal rates and just abruptly switch the actual rate over at that threshold. I mean, if that is how they are going to act, let's just do it. Nothing is apparently gained through having marginal rates be the reality. We are just leaving money on the table when the collective insistence of people for decades is that marginal taxes don't exist and the rate's just abruptly hiked to a different one. So fine. Marginal rates don't exist, then. Happy?

rsynnott 5y ago

> you only need to make like $250k total. hackernews.txt > AND the government is taking home more of your money than you do. No it isn't. The government is taking more than half of the money that you _make at the marginal rate_. You'd want to be earning a lot more than that to have >50% total.

disgruntledphd2 5y ago
Yeah, I hit the highest marginal rate at about a third of my income, and yet I still only pay approximately one third of my gross as tax yearly.

pjc50 5y ago

> If anyone wants to increases taxes even 1%, I want there to be a big fight about it. Serious demands in to budget efficiency and transparency. If it passes, I want to know there is scrutiny over the taking of my dollars. > Passing a 10% increase swiftly and suddenly is like a punch to the gut The problem is that there have been decades of unserious scrutiny. Every percent is fought over regardless of what the underlying details might be. So what you get is a situation where only "big bang" changes happen, because once the politics manages to break the deadlock, why waste that narrow change window on 1%?

imtringued 5y ago

I find it interesting how people stopped caring about everything except housing. It's like humans have succeeded at almost everything except one thing and then people tell you that their basic needs aren't met as if the rest of their life is just as bad when it's the opposite. People want housing to be exclusive and they want you to get the hell out of their hometown.

flerchin 5y ago

Do income spreading if having an unusual year. This spreads your income across the past several years, and allows a lower marginal tax-rate.

chromatin 5y ago
Do you mean exercise of options and sales of shares? Because otherwise this strategy is only available to the business owner(s). Thx, tax strategy newbie.
- flerchin 5y ago
  I don't know where you get that idea. I mean income spreading, and it's available to individuals. Leave your personal attacks on another forum please. https://www.investopedia.com/terms/i/incomespreading.asp https://www.investopedia.com/terms/i/incomespreading.asp
  - chromatin 5y ago
    > Leave your personal attacks on another forum please. what?

micromacrofoot 5y ago

You're damned if you do and damned if you don't. If you raise taxes 10% you won't be able to touch them again for 10+ years because everyone will say "but you JUST raised taxes" — I've seen this happen locally. Bold suggestions tend to happen because they either get negotiated down and/or it's the only chance you get for quite some time.