I just did my father-in-law's taxes. He's retired and lives on some pensions, social security and income from some investments. So interest rates go up and he makes a few extra thousand. The marginal tax rate on that money for him is .... 46%. Yes, 46%. His adjusted gross income is under $50,000 and his marginal tax rate is 46%. Incredibly unfair. Do we hear a peep from the lying politicians (both parties) about this gross unfairness. Nooooooooooooooooo.
The cause: more regular income moves more of Social Security into taxable income. So you don't just pay tax on the extra $1,000, but on up to $1,850. So in much of the broad 25% tax bracket, the real marginal rate is 25% x 1.85 = 46% Arggggggghhhhhhhhhh.
These stinking politician scum are taking 46% of a retiree's extra income. And no one - not the so-called press watchdogs who are really lapdogs - is talking about it.