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What % of your income goes to tax + insurance premiums? Mine is 48% (well, it was before I FIRE’d)

Question

I can’t believe I never looked at this before. But, I was curious what % of my income was going toward taxes and health insurance while I was working. For the last full year I worked, it was at least 48%!!! You can see my numbers below. This was also my highest earning year.

I was especially surprised, because I expect my number to be much lower than other people with a similar income since I live in an inexpensive house relative to my income, drive a cheap car, spend less (so lower sales tax), and I know other areas have higher income, sales, and property tax rates.

* federal income tax $21,763.00
* state income tax $6,442.00
* FICA $9,229.00
* Employer FICA $9,229.00
* My insurance premium $2,040.00
* Employer Insurance Premium $5,496.00
* Property tax (car + house) $4,069.60
* sales tax (no idea) $0
* Total $58,268.60
* AGI $121,770.00
* Tax Rate 48%

Edit: as u/dominick555 pointed out, I should add any employer contributions to my income. Adding my employer’s contribution to health insurance and FICA, my rate goes down to 43%. Adding in my 401k contributions (which aren’t in the AGI number) to the denominator, my rate falls further to 38%.

Answers

Someone answered:

For this to be as accurate as possible you need to add the amounts your employer paid on your behalf to the denominator (AGI in this case).

That said the number will still be shocking. I’m going to go try this for me, I’ve always looked at effective federal tax rate. This is much more comprehensive. I’m in a similar situation to you, so I’m ready to be disappointed.

Someone answered:

My numbers are eerily similar to yours only my AGI is a bit higher and we also have home/auto/umbrella insurance.

Comes out closer to 40% for us. It's a lot of dough.

Edit: if we go off gross and not agi it's closer to 30%.

Someone answered:

For comparison with the countries across the pond for those of you interested, here is mine, a Romanian: 41.25% total tax on gross, divided as follows:

  • 10% is health insurance

  • 21.25% social contributions (our equivalent of social security, unemployment benefits, education, etc.)

  • 10% income tax

There's an added 3.75% extra on top of the 41.25% that get automatically deducted from my paycheck, but those go to our local equivalent of 401k so it's not really taxed, I just don't have access to them until I retire.

Also, I omitted the property tax on purpose since last year it was less than 7$ per month, so not worth bothering with the calculations