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View Diary: Do YOU understand how tax brackets work??? (25 comments)

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  •  It used to be different (0+ / 0-)

    There used to be real tax "brackets" and so it's understandable that some folks still think it works that way.

    •  I don't understand your comment (2+ / 0-)
      Recommended by:
      tcdup, BachFan

      There still is and always was marginal tax brackets (on income).  What changed?

      Republicans: Taking the country back ... to the 19th century

      by yet another liberal on Tue Nov 20, 2012 at 07:58:13 AM PST

      [ Parent ]

      •  don't know, maybe I'm confused but back then (1+ / 0-)
        Recommended by:
        johnny wurster

        There was a "jump point", here is a description:

        The benefit of the first rate bracket is eliminated by an increased rate above certain thresholds. The phase-out range of the benefit of the first rate bracket was as follows: Taxable income between $71,900 and $149,250 in 1988; taxable income between $74,850 and $155,320 in 1989; and taxable income between $78,400 and $162,770 in 1990. The phase-out of the benefit the first rate bracket was repealed for taxable years beginning after December 31, 1990. This added 5 percentage points to the marginal rate for those by the phaseout, producing a 33 percent effective rate.
        I just remember back then there was a "jump point" where if you made a certain amount your whole tax bill jumped. But I could certainly be mistaken.

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