Graphing effective tax rate across an income range?

[tpac]

Is there a way to graph relative effective tax rate over an income range?

Essentially I want to plug in some variables and see roughly how my tax rate will fluctuate over a large income range. For example $26-28k, $28-30k... all the way up to $200-202k etc..

There are a number of factors I'd like to include:

1. Income
2. Fed / state tax
3. Self employment taxes
4. Self employment tax deduction
5. Self-employed SEP, SIMPLE, and qualified plans
6. ACA subsidy (effectively a progressive tax, more income = more tax)
7. SE health insurance deduction (increases as ACA subsidy decreases)
8. SE health insurance deduction (dental & LTC, not subsidized)
9. IBR student loan payments
   (betting on loan forgiveness so treat IBR payments as tax)
10. Student loan interest deduction
    (if IBR payments are tax, first $2500 are effectively a lower tax rate)

It's hard to visualize how my effective tax rate changes as my income increases / decreases since so many of these factors are dependent on one another. Hoping to find a way to just spit out a graph so I can identify where the amount of wages I actually get to keep falls off and start investing that time back into things that aren't taxed (gym time, family time, etc). Working for myself it's relatively straightforward to dial my work hours and my income in to the degree it makes sense to do so.

(Sure the list above is missing a bunch of things, but those are the big ones for me at the moment.)

 

[RunningBum]

Maybe there's a tool that can do this for you. I don't know of one that really factors in everything, and you have a lot. I do more brute force with a spreadsheet, using a couple of websites to give me numbers I plug into it. You can then graph from the spreadsheet, but I just show the delta % at each increment to see where it takes off.

healthsherpa.com is the easiest way to do incremental income amounts to show the impact on your ACA subsidy.
https://www.irscalculators.com/tax-calculator is a good tax estimator that lets you change income values on a single page. A lot of the things you list probably affect "unearned income" or deductions on this page.

I do something like this every year to incrementally see the effect Roth conversions have on income taxes and the ACA subsidy. Your spreadsheet would be more complicated, but doable.

 

[SecondCor521]

You might try

https://www.bogleheads.org/wiki/Tools_and_calculators#Personal_finance_toolbox

You'll need real Excel to use it.

It'll do a graph (I think it uses an Excel macro) for you based on varying something like a Roth conversion.

Not sure if it does everything you list, but you can check it out.

 

[sengsational]

My income isn't from work, but from how much to pull or convert from pre-tax accounts. But I think the principle is the same. So what I do is just do my taxes in PC software using estimates, if I don't have actuals. Then titrate the income and watch the marginal and overall tax rate change. Unfortunately, H&R Block doesn't allow select/copy of text from the screen, so I do it manually rather than with a script.

 

[tpac]

Sounds like everyone is doing this more or less manually (like I am) - figuring out results at each individual level with the help of calculators then plugging them into a separate results sheet then graphing the results.

Has anyone tried to build something more all-in-one though?

 

[SecondCor521]

Has anyone tried to build something more all-in-one though?

Did you try the spreadsheet mentioned in post #3 yet?

It does a graph over any selected range for a number of different variables, and does at least #1 through #6 on your list.

It can iterate for ACA/SEHI, but I don't know how that iterative process works or doesn't with the graphing feature.

It probably does #8 and #10 on your list also, but not 100% sure.

 

[SevenUp]

Has anyone tried to build something more all-in-one though?

Did you try the spreadsheet mentioned in post #3 yet?

That would be a good place to start. The comments in the chart were added by the poster, but this post in 2023: Roth conversion vs ACA subsidies - Bogleheads.org shows the type of chart that can be generated automatically.