Quote:
Originally Posted by FreightDawgyDog
So the 25% is withheld initially and if you are in the 28% tax bracket you pay 3% more at tax time? If so that is a heck of a lot better than the scenario I heard. Thanks..
No that is not the way the tax system works. I am in the 28% tax bracket but last year only paid about 15% tax. Why? Because I have many deductions (mostly a huge mortgage) and three kids. When all is said and done I don't pay a lot of tax. It is interesting how fast the marginal rate goes up after 200k however.