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How do income taxes work in the US? Let's say I am offered a salary of $100k, what's the rule of thumb to estimate my take-home pay?
For comparison, here's how it's done in Russia. Let's say I am offered 9M rubles per year. This amount includes my income tax that will be deducted by the employer and excludes my social security contributions that will be paid by the employer on top of 10M. There are just two tax brackets: 13% on the first 5M, 15% on the rest. So my take-home pay is 50.87+40.85=7.75M rubles annually.
From what I know about various EU countries, it's more or less the same, except the number of tax brackets is higher and there are additional concerns like having a (non-)working partner and/or underage children that affect the tax rate, but your income taxes are done by the employer.
Rule of thumbs: 20% at 50k; 25-30% from 75-100k; 30-35% from 100k to 250k; 35-40% from 250k to 500k.
It works pretty similarly, but states are entirely separate for purposes of taxation and some tax income and others do not tax income but instead have higher property or sales taxes, e.g., Florida has no income tax, but high property taxes and Tennessee has no income tax, but higher sales tax. For a typical employee of a company ("W-2 employee" referring to the IRS form you file for this type of employment), your taxes are broken down in a similar manner. There are payroll taxes and income taxes at the local, state, and federal level. Payroll taxes are split equally between the employee (7.65% of income capped at first 100k income) and the employer and cover programs like social security and health insurance for the poor/old. There are more marginal tax brackets than your example. On 100k, after the standard deduction from gross salary ($13,850), you are in the third marginal tax bracket at the federal level. It's similar at the state level.
On 100k for a single person with no kids in a State like New York:
Payroll:
7.65% on 100k = $7,650 (your employer also pays this amount on your behalf to the government for a total of $15,300 on a "$100k" salary for both of you, but you're only responsible for half)
Income Tax:
NY: Income is $92,000 after 8,000 standard deduction. 1st Bracket: 4% for 0-8,500 = 340. 4.5% for 8501-11,700= 143. 5.25% for 11,701-13,900=115. 5.85% for 13,901-80,650=3,904. 6.25% for 80,651-215,400=709. Sum: $5,213.75
Federal: Income is $86,150 after standard deduction. 1st Bracket: 10% for 0-11,000 = 1,100. 12% for 11,001-44,725 = 4,046. 22% for 44,726-95,375 = 86,150-44,725*.22 = $9,113. Sum: $14,260.
So on a 100k salary, you pay $27,124.25 in income taxes (incl. your payroll) and your take-home pay is $72,875 in the state of NY.
These numbers change with a jointly filing partner or children as your deductions go up for dependents (children) and bracket shift upwards.
Income taxes are not done by your employer in the US. Your employer automatically pays their part and your part for payroll taxes. They also withhold a certain amount of your salary (there are conditions you can get out of this) and send it to the government per paycheck, but employees are still required to file a tax return at least 1x a year in order to account for their income and potentially get a return from the amount already sent to the government by your employer because of withholding or a bill. The same is true on the state level. Most local income taxes are done by the state so it's just an extra section if you live in certain localities on your state return.
Good to see that the brazen fiction of a "paid by employer" part to hide your true tax burden is in some form alive everywhere. I realize it is too diffuse a problem to meaningfully lobby against, but it is fascinating to me that both the original post's 9M rubles and your 100k are abstractions inbetween the sum you cost the employer and the sum you receive.
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