How can one not know what they make post-tax, at least well enough to not be off by a few dollars? That is, after all, what one has to actually pay bills with. I know what my net earnings after taxes, retirement, etc. are to the nearest dollar, every paycheck. When I was substantially poorer (in academia, and prior to that school) I knew down to the penny (as a function of hours worked, even, when I worked hourly pay jobs).
> How can one not know what they make post-tax, at least well enough to not be off by a few dollars? That is, after all, what one has to actually pay bills with.
In my case, because I spend significantly less than I make, so I don't really need to think about my monthly bills. Yes, that's an incredible luxury, and yes I have friends and family for whom even a few tens of dollars of unexpected expense at the wrong time can mean disaster (and yes, I help them out).
Like you, when I made minimum wage I knew my after-withholding figure. But now? I honestly don't know.
> How can one not know what they make post-tax, at least well enough to not be off by a few dollars?
In the US, I guess you can look at how much salary appeared in your bank account, and multiply it by 12, to get the yearly salary.
In European countries, there are holiday bonuses and in some countries a 13th month salary, so the yearly income is something between 12.5 to 13.5 times the monthly pay.
I think the allusion was to what their all-in tax rate is. Everyone knows what their take home paycheck is, but ask the same person what their effective tax rate was for the year, and most people don't have a clue (over withholding, 401k deduction, mortgage interest deduction, state and property tax deductions, phase outs etc)
I think the point is they don't want Americans doing the math of taking their gross earnings and subtracting a percentage of it and being reminded of the specific percentage of tax paid and gross taxation every quarter. Taking it from each paycheck quietly is a softer blow than all at once.
It would be fascinating to change Tax Day from April 15th to the first Monday after the Federal election in November.
I'm not willing to predict the results but it would cause some interesting debates.. imagine everyone being in the middle of their taxes when they cast their votes.
For most Brits, most of the time they're one and the same - the taxman will tell your employer your tax code (= your tax free amount) and it's usually the same offset from standard each year. From this thread it appears that American taxes have more complicated rules.
