Effective Tax Rate 2008

[noppenbd]

I think the most meaningful number is the percentage of gross. Percent of AGI is not that meaningful. For instance, someone could have significantly different AGI just by putting 10K in traditional IRA (5K per spouse), versus putting the same 10K in 401k. To me this is not a meaningful distinction, but it would have a big influence on effective tax rate using AGI.

EDIT: My mistake, AGI is after IRA contributions, so the AGI number is meaningful.

[jIM_Ohio]

The traditional IRA would reduce AGI- as that is before AGI is calculated on the tax return.

[MonkeyMama]

For me, AGI = gross income. So I guess why I find it an interesting measure, personally. But a good point, of course. AGI tells you nothing of gross income in general.

Even so only about 45% of my income is taxed. Plenty of deductions after AGI.

[jIM_Ohio]

For me, AGI = gross income. So I guess why I find it an interesting measure, personally. But a good point, of course. AGI tells you nothing of gross income in general.

Even so only about 45% of my income is taxed. Plenty of deductions after AGI.

45% is quite impressive- any time less than 50% of income is taxed, that is a great tax plan.

[MonkeyMama]

Or maybe I just live in an expensive area with big mortgage and high state taxes. & we fund our own health insurance. I don't think it's all that great. LOL. I don't keep our mortgage or fund our health insurance for the tax break - for sure!

I am sure a lot of our relatives in San Francisco pay on less than 45%. But they have absurd mortgages.

[Caoineag]

Or maybe I just live in an expensive area with big mortgage and high state taxes. & we fund our own health insurance. I don't think it's all that great. LOL. I don't keep our mortgage or fund our health insurance for the tax break - for sure!

I am sure a lot of our relatives in San Francisco pay on less than 45%. But they have absurd mortgages.

That's why I don't feel so bad about the fact that I pay a higher percentage in taxes. We don't have the deductions because our lifestyle isn't as expensive as some. No kids, cheap mortgage, don't pay much for our healthcare and fairly low tax rates. Roths are not deductible. Why should I pay $1 to save $0.25?

[Joan.of.the.Arch]

8.32% (comp to 7.77 % last year) Be consistent!

[Goldy1]

what is effective tax rate?

[jIM_Ohio]

what is effective tax rate?

tax liability/gross income (tax liability/AGI) according to turbo tax.

[kork13]

I just did my taxes today, and even got a good laugh out of it!

% of gross: 5.4%
% of AGI: 6.2%

However, here's the funny part... my federal refund this year is a heavy-hitting $9!! Thanks go mostly to nearly $2k in capital losses from consolidating my investments into a couple index funds... at least there's one benefit of the poor market, considering I walked in expecting to pay about $600 to the Tax Man...

[globetraveler]

AGI 100k
taxable 82k
% taxable 82%
Total tax $13,244
effective tax rate (tax/AGI) 13.2%


I dont have a lot of deductions to speak of. No Kids yet, no mortgage yet.

I get to deduct our school loan interest and thats about it.

[cptacek]

0%. Wage income was $93,500, farm loss was $88,120 ($54,000 in depreciation, $34,120 in net loss), other misc additions and subtractions means $18,405 AGI. $11,900 itemized deductions, $7000 exemptions means no taxes paid federal.

First year for that. I usually pay about 10%. I'd rather have a profit on the farm and pay the taxes, though!

[Slug]

11.2% Almost twice last year's rate. It's OK though since I spent half the year in an apartment so I lost a lot of write-off on mortgage interest and property taxes. Still getting way too much back despite maximizing my exemptions.

[adam_c]

AGI $75,040
Taxable income $45,952
Total Tax $3,094
Tax Bracket 15%
Effective tax rate 4.12%

The tax credit of $3,000 for our three children made a significant difference.

[tripods68]

Just did our taxes today and I'm happy to report:

FEDERAL
AGI: $132K
Taxable Income: $84K
Total Tax Payment: $16K
Refund: $4,107
Marginal Tax Rate: 25%
Effective Tax Rate: 14.6%

STATE-CA
Income: $132K
Total Taxable Income: $105K
OWE: $97.00
Total Tax Liability: $4K
Marginal Tax Rate: 9.3%
Effective Tax Rate: 4.2%