Press play above, then read the full written lesson in the next item.
What people think a raise costsThe whole salary re-taxed
What it actually costsOnly the dollars above the line
Brackets are marginal. Moving into a higher bracket never leaves you with less, because only the income above the threshold is taxed at the higher rate.
Marginal rate22%What your next dollar costs
Effective rate14%What all of it actually cost
The one people quoteMarginalThe one they feel: effective