noelenrik00200
New member
How does progressive income tax actually work (in as simple terms as possible)
The way I understood it is that you only get taxed the prescribed amount on the income that is in that tax bracket
The way a lot of people understand it is that as soon as you hit the next tax bracket, you’re taxed your entire income at that bracket’s income amount
If you make 355k, you’re in the highest tax bracket… but if you only make just 355k or not much more, you should get a ton of taxes back at income tax time right?
I’m wondering as I’m currently taxed 43% to 48% on every paycheck (depending on whether or not I work overtime), but technically I should be getting taxed 20% up to x amount, then the next bracket up to x amount…
Am I thinking about this all wrong?
The way I understood it is that you only get taxed the prescribed amount on the income that is in that tax bracket
The way a lot of people understand it is that as soon as you hit the next tax bracket, you’re taxed your entire income at that bracket’s income amount
If you make 355k, you’re in the highest tax bracket… but if you only make just 355k or not much more, you should get a ton of taxes back at income tax time right?
I’m wondering as I’m currently taxed 43% to 48% on every paycheck (depending on whether or not I work overtime), but technically I should be getting taxed 20% up to x amount, then the next bracket up to x amount…
Am I thinking about this all wrong?