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View Poll Results: Poll: Your eff. tax rate (see original post to calculate!)
0% or less 6 5.00%
0% < my eff rate <= 5% 12 10.00%
5% < my eff rate <= 10% 20 16.67%
10% < my eff rate <= 15% 36 30.00%
15% < my eff rate <= 20% 22 18.33%
20% < my eff rate <= 25% 11 9.17%
more than 25% 13 10.83%
Voters: 120. You may not vote on this poll

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Old 08-18-2012, 03:44 PM   #21
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Mine was 20.5% for 2011.
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Old 08-18-2012, 03:49 PM   #22
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I fell into the 3rd bracket. That means either I do a fair job of managing my taxes or I'm poor as hell. If you could see me right now sitting in my recliner wearing shorts and an old t-shirt, you would probably vote the latter. Oh yes.......and sipping on a cheap med.
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Old 08-18-2012, 04:06 PM   #23
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Quote:
Originally Posted by Amethyst View Post
Are we the only ones who get stuck paying AMT? Effective rate, 21% whether we deserve it or not. No offshore investments here...

Amethyst
I did too large of a Roth conversion and hit AMT and 21%, so I recharacterized a good portion of it and amended my return.
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Old 08-18-2012, 04:07 PM   #24
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We pay AMT also. But it only applies against the ordinary income, not against the capital gains and qualified dividends income. So we still end up having <15% effective tax rate since our ordinary income is low compared to cap gain income.
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Old 08-18-2012, 04:13 PM   #25
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I answered a similar question for Ha in a thread of his a while back. I had to pull out my tax return, because I did not remember. And now, I forgot it again.

I will say that my tax was awfully low due to various deductions and education credits. It was low enough that it made me feel guilty, for a guy who had income in the low 6-figure from investment income and part-time work.

This year, my income will be a lot lower since I stopped my part-time work. On the other hand, I have no more college tuition to pay, and my children are no longer dependents. And then, I will be drawing from after-tax accounts for a while, instead of IRAs and 401k's. So, who knows what my tax will be. Zero?

PS. It's about time I look into doing Roth conversion.

PPS. I was referring to FIT only, and not counting SS or Medicare.
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Old 08-18-2012, 06:13 PM   #26
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I'm ESR and our taxes were between 15-20%, about 2/3rds of which was self-employment tax (SS and Medicare).
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Old 08-18-2012, 06:52 PM   #27
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Assuming this was for USA only (I'm Canadian) I didn't answer. I did the math arithmetic for the last two tax years. Due to great tax planning, 2010 income was high 6 figures, 2011 was ~= $55K.

2010:
- Federal 14.2 (bulk of income was capital gains, 50% taxed as income)
- Provincial 7.1

2011:
- Federal 16.6 (no CG, no surprise)
- Provincial 9.2

Edit to add:
I got "free" health care
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Old 08-18-2012, 10:07 PM   #28
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Federal is around 3%. State is a little higher (no generous kid standard deductions and a smaller personal exemption).

My true income is much higher than my AGI though, since we defer around $75,000 in income at a minimum, sometimes over $80,000 tax deferred savings, plus other untaxed monies we funnel through the child care and medical care FSAs. As a result of smart tax planning, we pay under 2% of our gross income in federal tax.

And this year we have another deduction (yay babies!) that will push our total federal income taxes to right around zero (probably a couple hundred dollars in the positive).
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Old 08-18-2012, 11:32 PM   #29
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My actual 2011 (last full year of work) was 18.50% effective rate calculating as you described and 28% marginal rate.

However, interestingly, my TurboTax 2011 Tax Summary form indicates that my effective rate is 17.38%. It seems that TurboTax excludes AMT in calculating the effective rate on that page. Since the AMT is real and was painful, I think your calculation is a more realistic effective tax rate.

For 2012, my first year of RE, I expect my effective federal tax rate to be 0%. Since the OP was focused on retiree tax rates, that is how I recorded my vote. While I will do some Roth conversion in 2012, I am taking a lower Roth conversion to optimize the property tax relief credit in my state. This will put us at ~310% of poverty level and will hopefully also optimize our ObamaCare medical insurance subsidy in 2014.

The way the federal income tax, state income tax and property tax relief interact if I convert another 100 of IRA to a Roth, it would cost me 1,688 in tax/loss of property tax relief (a whopping 1688% marginal rate) or if I convert an additional 10,000 it would cost me 2,353 in tax/loss of property tax relief (23.5% marginal rate). Too much.
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Old 08-19-2012, 06:59 AM   #30
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Quote:
Originally Posted by Amethyst View Post
Are we the only ones who get stuck paying AMT? Effective rate, 21% whether we deserve it or not. No offshore investments here...

Amethyst
Nope, we are in that boat too.
While the majority of our income is dividends so that is unaffected.
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Old 08-19-2012, 07:32 AM   #31
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So any general conclusions? Maybe Canadians pay less than expected despite the health care advantage? Or the middle class (as represented here) pays quite a lot? Or difficult to draw any conclusions given the diverse circumstances evident here? i personally feel my taxes are quite reasonable given the services we enjoy.
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Old 08-19-2012, 07:42 AM   #32
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Actually I thought more about this. My max marg rate for my pension is 39% while it is 19% for dividends. I get a large deduction for alimony which I should ignore. So since will only receive dividends and pension this year my average rate in 2012 should be about 27% if I ignore the alimony deduction. This is total combined fed and provincial. Still think this is a good deal.
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Old 08-19-2012, 09:29 AM   #33
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I"m at 14.5% - just barely under the 15% level. But my state taxes are also quite high.
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Old 08-19-2012, 10:25 AM   #34
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Mine came out to 11.6% for 2011. It was 10% in 2010. I got hit extra hard in 2011 because when the market started peaking earlier in the year, I cashed in some stocks and mutual funds to lock in some long-term gains. When the market started tanking, I bought some back.
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Old 08-19-2012, 01:43 PM   #35
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I think it is quite interesting to see the range of answers. I appreciate the poll and people who answered.
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Old 08-19-2012, 02:56 PM   #36
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For us the effective rate was 4.6% and we're in the 10% tax bracket for Federal. DH has a pension, I have a 10 hr/week part time job and we have some interest income.

For the state income taxes here in Ohio it was 1.4% effective rate in the 3.521% bracket. There is a nice retiree credit and joint filing credit after the tax calculation so that's why the effective rate is so low.

We pay local income taxes, too. It's 2% on earnings, so the pension payment and interest income are not taxed locally, just my part-time income.
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Old 08-19-2012, 06:04 PM   #37
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I didn't vote, because DW won't officially retire until next year, but I actually have a spreadsheet with this information.

Over my w*rking life, the rate has been somewhere between a low of 9.8% and a high of 25.5%.
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Old 08-19-2012, 06:20 PM   #38
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Ours was around 22% (federal vs AGI). Both w*rking; multiple incomes (W2, LLC-1099, rentals). Marginal 33%. Hoping to push both lower with individual 401(k) profit sharing this year, but our desire to RE means we gotta pour a large chunk into taxable accounts.
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Old 08-20-2012, 05:58 PM   #39
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6.56%

Sure helps to have two boys under 17 to get the full child tax credit.
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Old 08-20-2012, 07:56 PM   #40
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Ret'd 22 yrs. 0% until last year, when we had to go into non deferred accounts.
Wasn't planned that way., Just worked out. Tax free gain on house sale helped .
Some day will look to see if we would have been ahead of the game by investing.
Until recently, there were many available benefits (mostly state) for low income... not subject to net assets test. The door has closed on most of these, within the past year. (health, pharma, house taxes, tax freeze, free transportation, driver license reductions, phone subsidies etc. Some Pharma companies offer free or low cost drugs where income, not assets is the criterion. At a time when many pharmaceutical regimens run into the thousands, this can be a huge savings for pre Plan D people. Check out Prolia costs...
This year, at age 76, we'll start paying taxes again with more deferred withdrawals.
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