Author Topic: Marginal Tax Rates are not that complicated  (Read 10125 times)

FrugalToque

  • Global Moderator
  • Pencil Stache
  • *****
  • Posts: 557
  • Location: Canada
Marginal Tax Rates are not that complicated
« on: February 23, 2012, 12:07:57 PM »
At least they shouldn't be.  Take a look at what happens when a financially savvy guy tries to explain how marginal tax rates work.

The things to look at are the comments in which people completely ignore what he's written - in bold - and start multiplying the marginal tax rate by the entire income.

Then they call him names.

http://wheredoesallmymoneygo.com/the-canadian-tax-bracket-system/

When you see people racking up credit card debt, misunderstanding investment and making weird statements about this politician or that, you should know that this is what we're up against.

velocistar237

  • Handlebar Stache
  • *****
  • Posts: 1422
  • Location: Metro Boston
Re: Marginal Tax Rates are not that complicated
« Reply #1 on: February 23, 2012, 12:32:55 PM »
I found this site when JD Roth had a guest poster make a mistake about marginal tax rates:

http://badmoneyadvice.com/

Here's JD's mistake. (I could only find the cached page. I wonder if the corporate GRS overlords deleted the post.)

Unfortunately, BMA is now defunct. It was quite entertaining.

arebelspy

  • Administrator
  • Senior Mustachian
  • *****
  • Posts: 27290
  • Age: -999
  • Location: Traveling the World
Re: Marginal Tax Rates are not that complicated
« Reply #2 on: February 23, 2012, 01:44:27 PM »
I almost got into a discussion about Marginal Tax Rates with a friend the other day after she posted a misguided statement on Facebook, but then decided it wasn't worth an argument based on similar items from the OP that I've seen, where people just don't get it.

Amazing how poor the financial literacy is.

More amazing, to me, is how people are unwilling to learn.  They hear it "kicks you into a higher tax bracket" and think that they should try to earn less money.

It's unfortunate.
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.