Page 13 - The Other Side of The Mountain October 2018

Taxes
There are so many categories of
taxes you pay, it would be
difficult to list them all. Here is a
partial list for you to bemoan:

Federal Income tax, state
income tax, capital gains tax,
real estate tax, real property tax, school tax, personal property
tax, sales tax, vehicle license tax, gas tax, telephone tax, estate
tax, gift tax, alcohol and tobacco tax, hotel tax, airfare tax, entry
visa tax, sewer and water tax. The list goes on!

Here is some data for taxes on income. In 2015 Americans earned
$10.17 trillion in adjusted gross income and had a total income
tax liability of $1.45 trillion. The average gross income per return
was $67,564 with the average tax percentage just shy of
15%. You can add 6.2% for Social Security and Medicare taxes for
most of us. Then there is the average state and local income tax
rate of about 9.9%. The ballpark number comes out to be about
one-third of every dollar earned is paid in taxes on your income.

For 2018, in my home town of Coeur d’Alene, Idaho, a married
couple with $67,564 in gross earnings can expect to pay about
$17,295 in total income taxes (Federal, State, and FICA) with
25.6% of income to be paid in taxes. Source: smartasset.com

If you are already retired and no longer working, you still must
deal with all the other taxes based not on income, but on
consumption. These will take a bite out of your retirement
savings, so it makes sense to budget for these to get a realistic
idea of what remains for you to sustain your desired lifestyle.

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