Hell no, I only considered them employees, with self-employment double my SS and Medicare numbers which is a heck of a lot more.
Plus cutting the 401k is a terrible idea, especially since I forgot about the $30-40k bonuses.
I too believe they aren't living high off the hog. The huge number is the $31k/year child care from already taxed income! OUCH! That is painful and cuts deep into their pocketbook.
After assuming no AMT, which would make their tax bill bigger, they are looking at living on $101k/year for mortgage, minimum debts repayments and basic living expenses. This is pre-state tax, which is 9% in CA at their income so they'd be down another $20k potentially in state income taxes.
People in that bracket need to be extremely conscious about taxes. Belt-tightening in other areas is better than just saying "cut 401k." Focus on debt.
Consider repercussions for taxes.
|