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Effective tax rate
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When you are done with TurboTax this year, it will tell you your "effective tax rate" for 2011.
Do you know how this rate is calculated?
Ok, every small business owner in Hawaii knows it, or his accountant knows it.
If you earn $100 extra, and you pay $25 in tax out of the $100. You can say your top tax rate is 25%, OR, you can say your top "effective tax rate" is 33%, which is based on what you actually get to keep, namely, the $75.
Since I only get to keep $66 for every last $100 I make from editing, my top "effective tax rate" is 50%. Why should I work hard?
https://blog.sciencenet.cn/blog-306792-536493.html
上一篇：Income taxes
下一篇：A star has fallen...
Do you know how this rate is calculated?
Ok, every small business owner in Hawaii knows it, or his accountant knows it.
If you earn $100 extra, and you pay $25 in tax out of the $100. You can say your top tax rate is 25%, OR, you can say your top "effective tax rate" is 33%, which is based on what you actually get to keep, namely, the $75.
Since I only get to keep $66 for every last $100 I make from editing, my top "effective tax rate" is 50%. Why should I work hard?
https://blog.sciencenet.cn/blog-306792-536493.html
上一篇：Income taxes
下一篇：A star has fallen...
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