The Balanced Spreadsheet-Financial News, Budget Advice, Debt help, Financial Tips, and other advice

September 29, 2009

How much do I pay in taxes?

Filed under: Personal Finance, Real Example, Simulation — Tags: , , , , — thebalancedspreadsheet @ 7:59 pm

Have you ever wondered how much you really pay in taxes each year?  I was curious and decided to see what my real income tax rate is.  I took what my wife and I had made so far this year and projected our earnings for the fourth quarter of 2009 and came up with our gross income.  I then did a tax projection and came up with the following:

09-29-09 How much do you pay in taxes

 

 We are in the 15% Federal tax bracket, but due to itemized deductions, 401(K) contributions and the Making work pay tax credit, we will pay about 7.5% of our gross in federal income taxes.  Our Social Security and Medicare taxes are blow their rates of 6.2% and 1.45% respectively due to health insurance premium deductions.  Even though property taxes are not tied to income, I included them anyways because they are a tax.  Unfortunately I do not keep all my receipts (I am not that much of a nerd. :)) though out the year to add sales tax in my calculations. 

The 22.45% tax means we worked until March 23rd to pay all our taxes for the year.  According to research done by the Tax Foundation, we beat Ohio’s average by 19 days (April 11th) and the national average by 21 days (April 13th)!

This post is not mean to be a pro-tax or anti-tax post.  It is just meant to be fun to see how much you really pay in taxes each year.  If you work for an employer most of your taxes are already taken out of your paycheck before it even gets to you and it is easy to forget to check how much you pay each year.

Advertisements

2 Comments »

  1. […] PDRTJS_settings_702890_post_513 = { "id" : "702890", "unique_id" : "wp-post-513", "title" : "The+Ohio+Marriage+Penalty", "item_id" : "_post_513", "permalink" : "http%3A%2F%2Fthebalancedspreadsheet.wordpress.com%2F2009%2F11%2F25%2Fthe-ohio-marriage-penalty%2F" } With 2009 quickly coming to a close, it is that special time of the year again. No, not Thanksgiving. No, not “Black Friday”, but time for year end tax planning! I know tax planning is not the most exciting thing in the world but I do feel it is important to keep an eye on it to make sure you are legally minimizing your tax bill as I have written before on how much you really pay in taxes. […]

    Pingback by The Ohio Marriage Penalty « The Balanced Spreadsheet-Financial News, Advice, tips, and more — November 25, 2009 @ 11:50 am

  2. […] our income taxes for 2009 I am finally ready to update a post I made back in September on how much do I really pay in taxes relative to my gross […]

    Pingback by Do you know your Tax Freedom Day? « The Balanced Spreadsheet-Financial News, Advice, tips, and more — March 8, 2010 @ 5:08 pm


RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Blog at WordPress.com.

%d bloggers like this: