The Raise That 'Costs You Money'

Transcript

Buck

I turned down a raise, it would've bumped me into a higher tax bracket and I'd earn LESS!

Sage

Only the income ABOVE the bracket line gets taxed higher. Not your whole paycheck.

Buck

Wait, so my first dollars still get taxed the SAME as before?

Sage

Exactly. A $2,000 raise might cost you a few hundred in extra tax, never the whole raise.

Buck

So I turned down free money... over a myth.

Sage

Always take the raise. Brackets are marginal, not scary.