5 ms·

How does half of $2K (over 2 years!) go to taxes? Doesn't that put you in the bracket where the government gives you money?

by andai 4y ago

gennarro 4y ago
Presumably he has a high paying engineering role as well
veidr 4y ago
not unless you don't get any other money
jklein11 4y ago
If you are doing content creation part time you are going to have more income than the 2k. the 50% is likely the marginal rate though and not the effective rate.
- ta1243 4y ago
  You should be able to offset a fair few costs against that income.
bryanrasmussen 4y ago
if you're in Denmark it would be easy to get to the point where half would go to taxes, also some countries can have different rates on what is your primary income and what is income earned from secondary sources that are taxed higher. However in the case of having a business that is generating taxable revenue you are probably also buying things at times you can deduct, so it's probably not as dire as all that - although depending on how things are you might not want to deduct more than you actually earn from your secondary source of income.
paulpauper 4y ago
Many Americans are surprised to learn how much higher taxes often are outside of America
- ta1243 4y ago
  California total taxes on a $100k income is 28% --- https://smartasset.com/taxes/california-tax-calculator#a3rz8Ar7SN https://smartasset.com/taxes/california-tax-calculator#a3rz8... UK it's 24% -- https://listentotaxman.com/?ingr=79000 https://listentotaxman.com/?ingr=79000
  - dragonwriter 4y ago
    1. The California calculation includes state and federal income and employee share of federal payroll taxes; the UK site appears to include only income tax [see EDIT] (the UK has more complicated payroll tax rates, but each of the employee and employer share can be close to as much as the combined US rate of 14.85% below the Social Security cap) [1]. 2. The UK has much higher consumption taxes than the US (including California) with a 20% VAT and gas taxes close to $3/gallon, compared to (in California) a maximum of 10.25% sales tax and $0.725/gallon state+federal excise tax on gas. [1] https://www.gov.uk/national-insurance-rates-letters https://www.gov.uk/national-insurance-rates-letters [EDIT: Actually, the UK calculation does include “National Insurance”, which is the payroll tax equivalent, but it is after the "total tax due" that the parent used for the comparison. With the employee share National Insurance payment included, the UK total is 30%, higher than the CA amount even before considering the impacts of higher consumption taxes and the higher employers-share National Insurance.]
  - woobar 4y ago
    Your links show that take home pay is higher in California ($72K vs £55K/$69K), despite higher tax rate.
    - dragonwriter 4y ago
      This is a result of including employee-share payroll tax (FICA) in the California tax total, but not including the UK equivalent (employee share of “National Insurance”), which is listed after the “total tax due”, as part of the UK tax total.
      - 4y ago

How does half of $2K (over 2 years!) go to taxes? Doesn't that put you in the bracket where the government gives you money?

by andai 4y ago

How does half of $2K (over 2 years!) go to taxes? Doesn't that put you in the bracket where the government gives you money?

gennarro 4y ago

Presumably he has a high paying engineering role as well

veidr 4y ago

not unless you don't get any other money

jklein11 4y ago

If you are doing content creation part time you are going to have more income than the 2k. the 50% is likely the marginal rate though and not the effective rate.

ta1243 4y ago
You should be able to offset a fair few costs against that income.

bryanrasmussen 4y ago

if you're in Denmark it would be easy to get to the point where half would go to taxes, also some countries can have different rates on what is your primary income and what is income earned from secondary sources that are taxed higher. However in the case of having a business that is generating taxable revenue you are probably also buying things at times you can deduct, so it's probably not as dire as all that - although depending on how things are you might not want to deduct more than you actually earn from your secondary source of income.

paulpauper 4y ago

Many Americans are surprised to learn how much higher taxes often are outside of America

ta1243 4y ago
California total taxes on a $100k income is 28% --- https://smartasset.com/taxes/california-tax-calculator#a3rz8Ar7SN https://smartasset.com/taxes/california-tax-calculator#a3rz8... UK it's 24% -- https://listentotaxman.com/?ingr=79000 https://listentotaxman.com/?ingr=79000
- dragonwriter 4y ago
  1. The California calculation includes state and federal income and employee share of federal payroll taxes; the UK site appears to include only income tax [see EDIT] (the UK has more complicated payroll tax rates, but each of the employee and employer share can be close to as much as the combined US rate of 14.85% below the Social Security cap) [1]. 2. The UK has much higher consumption taxes than the US (including California) with a 20% VAT and gas taxes close to $3/gallon, compared to (in California) a maximum of 10.25% sales tax and $0.725/gallon state+federal excise tax on gas. [1] https://www.gov.uk/national-insurance-rates-letters https://www.gov.uk/national-insurance-rates-letters [EDIT: Actually, the UK calculation does include “National Insurance”, which is the payroll tax equivalent, but it is after the "total tax due" that the parent used for the comparison. With the employee share National Insurance payment included, the UK total is 30%, higher than the CA amount even before considering the impacts of higher consumption taxes and the higher employers-share National Insurance.]
- woobar 4y ago
  Your links show that take home pay is higher in California ($72K vs £55K/$69K), despite higher tax rate.
  - dragonwriter 4y ago
    This is a result of including employee-share payroll tax (FICA) in the California tax total, but not including the UK equivalent (employee share of “National Insurance”), which is listed after the “total tax due”, as part of the UK tax total.
    - 4y ago