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LOL that's hilarious. I pay more in payroll taxes than on transportation. On top of the 15.3% (reduced to 13.3% for this year only) there are income, sales, and property taxes. I guess for a family who insists on driving two fairly new CamCord type cars, it's possible. $50,000 for a two-worker family translates to $12.50 an hour, however, which is basically working poor. The working poor has always had it tough. If it's a one-come household, then there's no reason they need two cars. I wouldn't ever spend 20% of my net income on transportation, but people are free to choose to spend their money as they want whatever their income level. There are certainly people stretching into luxury cars and paying that kind of money as well. If that means moving out to the suburbs and buying two CamCords to ferry you to your low-level job 30 miles away, so be it.
Catchy title but a family making $50-60k would not be paying much in income taxes. So it's really just a clever play on words to say they spend more on cars than taxes. Beyond that though $10k a year (I'm assuming that's for two cars) is an awful lot of money for a family to be spending on transportion on such a modest income.
We could say someone living in CA making $100,000/year would pay about 28% federal, 9% state, 5% SS/Medicare, 8% sales, for a total of about 50% of income going to taxes (add in others like property and its even higher). If they're spending more on their car, they've got problems.
Or we can look at a single person making $50,000/year. Pay a federal income tax of 25%, or $12,500, which is still higher than the quoted $10,000.
Or look at a family making $60,000 a year with a tax rate of 15% pays $9,000 in federal tax. Add in state, property, sales, etc, and it's more than $10,000.
So basically, they found just one instance (cost of driving vs federal income tax for joint filing at $60,000) to try and say people spend too much on transportation.
We could say someone living in CA making $100,000/year would pay about 28% federal, 9% state, 5% SS/Medicare, 8% sales, for a total of about 50% of income going to taxes (add in others like property and its even higher). If they're spending more on their car, they've got problems.
Or we can look at a single person making $50,000/year. Pay a federal income tax of 25%, or $12,500, which is still higher than the quoted $10,000.
Or look at a family making $60,000 a year with a tax rate of 15% pays $9,000 in federal tax. Add in state, property, sales, etc, and it's more than $10,000.
So basically, they found just one instance (cost of driving vs federal income tax for joint filing at $60,000) to try and say people spend too much on transportation.
Except they're married and so it's 15% above $17,000. They're MAGI is probably 30,000. So they're only paying 15% on around $10,000 and another 10% on $20,000 -- 1500+2000=3500. Plus they probably have some tax credits that drop that down even further.
Lol, I "pay" more in Taxes than any other item in my monthly budget..
~$800 in taxes
~$600 rent
~$150 transportation (gas + insurance, car fully paid off.)
Even if we total the amount of taxes I've paid vs. the amount I've spent on the car (including gas, insurance, etc.) taxes still end up taking the bigger chunk.
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
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Quote:
Originally Posted by ragnarkar
Lol, I "pay" more in Taxes than any other item in my monthly budget..
Me too, transportation is not even a blip on the radar screen.
I drive a $35 car than gets 50 mpg on free fryer grease, $240/ yr insurance, get tires from wrecking yard... & feed family on $100/ month.
BUT:
1000/ month in property taxes alone (not figuring a zillion other taxes from fuel / phone / to personal property)
1200 / month basic health insurance....
Is this accurate? That family must have a lot more tax breaks than I do.
It alleges the family spends $10K a year on automobile related expenses. My federal. state, and property income taxes last year were about $17,000. Add in sales tax at 8.75% and I could buy a new car every year for what I spend on taxes.
In comparison, my operating expenses were $1000 for insurance, $1800 for gas, and I will figure about $6000 for the car (although it is paid off, if I had a loan that would likely be the yearly cost). Even with other maintenance, it pails in comparison to my taxes.
There is NO way that I pay less taxes then car expenses. Not even close.
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