5 ms·

> 37% top US tax rate That's not true either. In California, you will also pay state income tax, most likely at 9.3% marginal rate - but possibly not too diffe

by creer 3y ago

> 37% top US tax rate That's not true either. In California, you will also pay state income tax, most likely at 9.3% marginal rate - but possibly not too different in actual rate because the California thresholds are low. To continue the comparison, you'll need to consider which part of health insurance is or is not included (none in the US.) Etc. In the end, the marginal tax rates are pretty close. Meaning, shockingly high in California. And if you do come here for work, consider also exit tax. If you are successful, you will fall under exit tax if you ever want to leave.

fragmede 3y ago
In California, you'll end up paying a total of 50.3% tax rate if you make over $1 million. Federal 37%, state 13.3% adds up to 50.3%
- defrost 3y ago
  Both state and federal are progressive tax brackets and the 50.3% tax rate is only paid on dollars earnt over a threshold. https://youtu.be/4PJfDNfg5KI?t=77 https://youtu.be/4PJfDNfg5KI?t=77
  - fragmede 3y ago
    Yes, that's correct. If I did my math correctly, if you made $4 million, you'd end up with $2,052,391.57, which is an overall rate of 48.69%, for those that don't understand progressive tax rates.
    - fragmede 3y ago
      (For someone who's single; unmarried)
- fjdjshsh 3y ago
  If you earn 300k a year, what's the average tax rate you're paying? (Marginal tax rate isn't a helpful number for that)
  - fragmede 3y ago
    For someone who's single/unmarried, $300k is under the peak brackets, which is above $578,125 for federal, and above $312,686 for California, so you'd only pay the progressive rate of 35% Federal and 9.3% California for a total of 44.3%. My math says you'd pay $101,790.74 in total, which makes for an effective tax rate of 33.93% on someone single making $300k/yr. (Assuming I did my spreadsheet right. I'm not a CPA, and definitely not yours!)
- subsubzero 3y ago
  What user defrost said. Also $1M is quite hard to do, that would indicate a salary(single not married in my example) of a principle engineer at FANG* or Sr. Director and there are very few of those around. Or you could be a Staff engineer and join a company with a parabolic stock price like NVDA or something similar.

by creer 3y ago

fragmede 3y ago

In California, you'll end up paying a total of 50.3% tax rate if you make over $1 million. Federal 37%, state 13.3% adds up to 50.3%

defrost 3y ago
Both state and federal are progressive tax brackets and the 50.3% tax rate is only paid on dollars earnt over a threshold. https://youtu.be/4PJfDNfg5KI?t=77 https://youtu.be/4PJfDNfg5KI?t=77
- fragmede 3y ago
  Yes, that's correct. If I did my math correctly, if you made $4 million, you'd end up with $2,052,391.57, which is an overall rate of 48.69%, for those that don't understand progressive tax rates.
  - fragmede 3y ago
    (For someone who's single; unmarried)
fjdjshsh 3y ago
If you earn 300k a year, what's the average tax rate you're paying? (Marginal tax rate isn't a helpful number for that)
- fragmede 3y ago
  For someone who's single/unmarried, $300k is under the peak brackets, which is above $578,125 for federal, and above $312,686 for California, so you'd only pay the progressive rate of 35% Federal and 9.3% California for a total of 44.3%. My math says you'd pay $101,790.74 in total, which makes for an effective tax rate of 33.93% on someone single making $300k/yr. (Assuming I did my spreadsheet right. I'm not a CPA, and definitely not yours!)
subsubzero 3y ago
What user defrost said. Also $1M is quite hard to do, that would indicate a salary(single not married in my example) of a principle engineer at FANG* or Sr. Director and there are very few of those around. Or you could be a Staff engineer and join a company with a parabolic stock price like NVDA or something similar.