At what income maximum should a person stop working to avoid Democrats taxes?

Economy
1

I want to find out how best to know at what income level is it that it’s not worth it to continue working for each year.

If most of the income is capital gains, if it gets to just under $400,000 will continuing to go for $500,000 be a detriment, actually backing up, or just making so little on it, may as well vacation the remainder of the year?

Or, would it be better to put yourself as an employee, pay so much in wages it nullifies the 43% capital gains that they are planning to make retroactive to the beginning of the year this year?

1 Like
2

Let’s test this out.

Let’s say you make $600,000.

$400,000 is taxed at 20% or 80k in taxes
Then next 200,000 is taxed at 40% or 80k in taxes.

So if you stay at 400k, you will pay 80k in taxes. Your net is 320k

If you stay at 600k, you will pay 160k in taxes. Your net is 440k.

Would you rather have 320k or 440k?

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3

Not my question. 400K to 500K? It’s 43%, not 40%

Tax on 500K will be 215K.

4

Formula is still the same.

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6

Tax on 500K will be 215K, leaving 285K.

7

I have a friend that gets into a 63% loss of his income to taxes sometimes. He resents it so much I wonder if he would just do better to take a vacation 6 months of the year rather than get into that level. If he makes 1.5 million & keeps only 555K. 945K goes to taxes. Not fair in my opinion. That’s .37 cents on the dollar.

8

What is the tax on 400k?

9

It’s 172K, leaving 228K. Yup, I know it’s leaving money on the table. Personally at that point I’d probably take off 6 months though, or buy something that’s deductible to negate it to zero. I hate over taxation to the point I would prefer that to funding the leftist state.

Also the layoffs I would have to do with the ones I know vote democrat would give me and them the opportunity to let them know why they wont have work. It MIGHT wake them up, but brainwash is often permanent…

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10

Unless its a lot of effort, why would you want less money?

2 Likes
11

To own the libs

3 Likes
12

So you would leave 57k on the table just to pay less taxes?

2 Likes
13

The tax on 500k is $123k, leaving $377.

Tax on 400k@20%=80k
Tax on remaining 100k@43%=43k
Total=123k

Effective tax rate = 24.6%
At 1M, the effective rate is 33.8%
At 2M, it’s 38.4%

14

If you’re worried about a small increase in the marginal tax rate on incomes over $400K, you were never at risk of making $400K to start with.

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15

Apparently you’re not getting the “marginal” part of “marginal tax rates”.

If taxes on incomes of $400K go up, it’s on money from $400K and up. Your examples consistently show you think it retroactively applies to all income at that rate.

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16

Since Biden’s capital gains increase would only be on people making more than $1 million, I’m hoping that is a problem I someday have to deal with

17

The proposal impacts people earning $1 million or more.

The changed behavior would be to avoid realizing gains until the next Republican leadership group reduces the rate. It will not be to stop working.

This is too big of an increase to be beneficial for the above reason. People will absolutely alter when they choose to realize gains until it makes sense.

I think we will ultimately wind up with a rate of around 25% or so.

1 Like
18

Yup, I would.

19

Baloney. The capital gains is what the discussion is about. The democrats want to take it from 20% to 43%. That’s NOT a small increase. It’s massive.

1 Like
20

Wrong. I’m talking about capitol gains, it’s 20% NOW. They dems want it to go to 43%

21

BINGO!