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Reasons You're NOT Paying Too High of Taxes - Taxes: Part One

Reasons You're NOT Paying Too High of Taxes - Taxes: Part One

October 01, 2020
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Welcome to the Weekly SUMmary - 10/02/2020

Feel like you're paying too much in taxes? You're not alone.

Let's first look at the history of taxes in America. The Top Marginal Federal Tax Rate, currently, is 37% (Chart below*). Historically speaking, the highest Top Marginal Federal Tax Rate was 94%. Yes! 94%!!! Feeling a little better about your current tax bracket?

Now, let's look at some things that could affect future tax rates:

  1. Federal Stimulus
  2. Federal Debt
    • Anyone that would like to scare themselves, see the US Debt Clock
  3. Infrastructure needs throughout America
    • Schools, Roads, Public Transportation all cost money
    • Government Employees are likely one of the largest expenses on an annualized basis
  4. Interest Rates
    • The government is making literally nothing on money they are lending to banks and the public, yet they pay interest on CDs and other investments

I, like most that I know, do not want to pay any more in taxes than I have to, but I also find value in what is provided for the public from the taxes we all pay. Therefore, I think one would be hard pressed to make an argument that current tax rates are too high in the United States.

Future blogs will address additional aspects of this topic and considerations for readers to contemplate.

There are many other factors and considerations that have not been addressed in this blog. This is purely for educational purposes and to provoke thought around perspective related to the topic at hand.

References:

Chart: https://www.taxpolicycenter.org/statistics/historical-highest-marginal-income-tax-rates

https://www.taxpolicycenter.org/briefing-book/what-did-2008-10-tax-stimulus-acts-do

Blog Photo by Markus Winkler on Unsplash

Waddell & Reed and its representatives do not provide tax advice.  (10/20)