November 22, 2020

Tax Brackets 2020

Tax Brackets 2020 it is election time and we're here to help you keep track of the biggest issues in the 2020 race issues like the top marginal tax rate first let's talk about tax brackets you can think about tax brackets like. Buckets when tax season comes around a lot of people think you find your tax. Bracket and then you pay that percentage on all your income but.

That isn't actually how it works let's say you make seventy thousand dollars a year that does not mean all of your 70 grand goes into the same bucket your money is, actually divided among the buckets only nine thousand seven hundred dollars, fits into the first bucket so you pay ten percent on that money the money you, make as that falls into the next bucket you're nine thousand seven hundred and first dollar so, you take twelve percent on that income you move to the next bucket when you make more than thirty nine thousand four hundred and seventy five dollars that would get taxed at twenty two, percent and so on this is why, your effective tax rate is usually lower than your marginal tax rate so when politicians talk about a top marginal tax rate say the seventy percent proposed by congresswoman Alexandra, Ocasio cortes they mean that income should be, taxed at seventy percent only once someone has filled all of their previous buckets it's a 70 percent tax rate. On some of your income not a 70 percent tax rate on all of your income right now none of the twenty twenty Democratic candidates have proposed a higher marginal tax rate although Kamala Harris.

Plans to provide tax credits to middle and low income families by rolling back tax breaks, for those making more than a hundred thousand dollars a year Bernie Sanders has proposed expanding the estate tax and Elizabeth Warren she's proposed an.

Ultra millionaire tax which. Would levy a wealth tax on Americans whose fortunes are worth over fifty million dollars that tax would hit assets not income in the past Joe Biden has supported a surtax on the first dollar after a person has. Made one million bucks but he hasn't yet said if that, is part of his 2020 platform under President Trump's tax plan the top one. Percent of taxpayers got a fifty-one thousand dollar tax cut so how do Americans feel about a higher marginal tax rate in a recent Hill Harris Poll 59 percent.

Of voters say they would support a 70 percent tax rate on the 10 millionth dollar for those making 10 million bucks or, more so we're gonna see if those 20 20 Democrats start including more income tax proposals as the race heats up hey NBC.

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