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Why is it that the more I earn, the higher percentage of federal withholdings they take? (lemmy.world)
submitted 10 months ago* (last edited 10 months ago) by LemmyKnowsBest@lemmy.world to c/personalfinance@lemmy.ml
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One paycheck I earned only $77 and the govt withheld 9% of it.

Then I earned $2,000 and they withheld 26% of it.

Is everyone else experiencing this?

The less you earn, the less percentage-wise the govt withholds? The more you earn, the greater percentage they withhold?

At this rate, I fear that if I hypothetically would earn $8,000, they would withhold 100% of it. Do you see where this is going?

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[-] chris@lemm.ee 2 points 9 months ago

This is how the tax rate works. As for your fear of them taking 100%, they won’t. The max single-payer tax rate, as of 2023, was 37%.

[-] LemmyKnowsBest@lemmy.world 2 points 9 months ago

Thank you 🙏

this post was submitted on 20 Jan 2024
-22 points (26.1% liked)

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