In response to Orrin Turbow's letter (May 18) in which he states that a couple receiving a raise would be better off to turn that raise down in that the additional money would bump them into the higher tax bracket--I'm confused. Or maybe he is.
It has been my understanding that the higher tax rate (27%) is applicable only to those monies earned over and above $29,300. If that is the case, his computations of a raise costing the family approximately $3,000 in spendable after-tax dollars would be incorrect. The raise would only cost the family $384.75, which would be a small enough amount to still welcome a 5% salary increase ($1,425 a year).
Can somebody clear this up? Does the higher tax bracket only swing into effect for the amount over and above $29,300--or do we get stung for the higher tax bracket on the entire amount of income?