Kevin’s Handy Tax Table for Innumerate Rich People

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Dave Weigel complains today that too many rich people have no idea how income taxes work. They’ve heard that Obama wants to raise tax rates on people who make more than $250,000, so they’re working on ways to keep their income right at $249,000. After all, if they go over the threshold, they’d suddenly have to pay the higher rate, and it would be a net loss.

This isn’t true, of course. Obama is only proposing to raise tax rates on income over $250,000, so if your income goes up to $251,000, you only pay the higher rate on the extra $1,000. The tax bill on your first $250,000 stays exactly the same.

But that’s hard to explain, and we’re all about solutions here, not petty griping. So I have the answer: an EZ-to-Read table that compares total taxes paid under the old Bush rates and the proposed Obama rates. It starts at $241,900 because that’s $250,000 minus the standard deduction, and it’s for married couples filing jointly.

Example: under the current Bush tax rates, a couple making $300,000 pays $75,802, or 25.27% of their total income. Under Obama’s plan, the rate goes up on the amount over $241,900, so they pay a whopping $2,000 more, or 25.85% of total income. Millionaires will pay $32,000 more. Raw data here. Share this with all your rich friends!

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We need to start raising significantly more in donations from our online community of readers, especially from those who read Mother Jones regularly but have never decided to pitch in because you figured others always will. We also need long-time and new donors, everyone, to keep showing up for us.

In "It's Not a Crisis. This Is the New Normal," we explain, as matter-of-factly as we can, what exactly our finances look like, how brutal it is to sustain quality journalism right now, what makes Mother Jones different than most of the news out there, and why support from readers is the only thing that keeps us going. Despite the challenges, we're optimistic we can increase the share of online readers who decide to donate—starting with hitting an ambitious $300,000 goal in just three weeks to make sure we can finish our fiscal year break-even in the coming months.

Please learn more about how Mother Jones works and our 47-year history of doing nonprofit journalism that you don't find elsewhere—and help us do it with a donation if you can. We've already cut expenses and hitting our online goal is critical right now.

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