How Much Taxes Do You Really Pay?

Hint: Its a hell of a lot more than your 'effective federal tax rate'

Taxes Suck.

There is so much that could be said about taxes.

• Tax system is absurdly complex with no benefit (7,000 pages and 1 million words)

• But the system is designed this way to keep rich rich and everyone else struggling

• The money is absolutely squandered

• It makes no sense

• It is way too high (remember when a stamp & tea tax lead to us murdering a bunch of red coats?)

• Withholding is evil genius level as most people think a tax refund is the gov’t giving them money. If you made everyone write a check in April for their tax burden it would be a revolt

But taxes are so pervasive, people don’t even realize how much they pay.

If you are the average person you don’t know what your tax rate is.

If you are astute, maybe you know what tax bracket you are in or what your effective tax rate was last year.

But almost no one keeps track of the entire tax burden they have to endure. But we will walk through all the taxes (we know of) in this post to show you that even if your tax return says you are paying 20%, your the money taken from you by the government is so so so much more.

[Note - we aren’t tax advisors. This is likely not an exhaustive list. Comment below if we miss any.]

We will use someone who makes $200k a year in W2 income. Ignore deductions, and assume they have $5k in capital gains and $5k in dividends and are married filing jointly household.