Originally Posted by
Gunfighter
I agree the concept of your post. Let's get the numbers correct before we build on this argument though.
The top marginal tax bracket is 37%, not 39% and that is for taxable income above 600k (married) 500k (single). Few pilots, even widebody captains will fall into this range. 400-600 of taxable income is taxed at 37%. If you are 315-400k, the marginal rate is only 32%. Keep in mind, we are talking about the marginal rate on taxable income. If you are making 450K per year as a captain, your taxable income after deductions is most likely in the 315-400 range at 32%.
Secondly, you are mis-applying the 3.8% Obamacare surtax. It is a tax on net investment income, not W-2 income.
Again, the concept is valid, but the amount lost to taxes is closer to 45% not 55%. With that tax penalty in mind, I agree we should be looking for a method of increasing retirement benefits in a tax efficient manner.
Well, not quibbling but in 2017...
"How much is the federal income tax rate?
In 2017, the income limits for all tax brackets and all filers will be adjusted for inflation and will be as follows (Table 1). The top marginal income tax rate of 39.6 percent will hit taxpayers with taxable income of $418,400 and higher for single filers and $470,700 and higher for married couples filing jointly.
Yea....hit that 39.6% incremental rate. I know rates are coming down this year
Additionally, there is an Obama care tax of .9% on all income over 200/ 250k (single/married) and you are correct about the 4%....and truth in advertising it is not 2%ALPA dues... but close....wat? 1.6....1.7...1.8....oh eff it, close enough to 2%.... even on the DC excess
With AMT I can unequivocally say "my butt is bloody"....I take home less than 50% of each additional dollar earned