Pretty new to investing and looking to calculate some of the numbers WCI recommends (net worth, savings rate, marginal/effective taxes, etc...). I see everyone posting their numbers on this blog and I am trying to figure out how to calculate mine. Marginal seems pretty easy but was curious how to calculate effective. I know it seems like total taxes paid/total income but usually I just pay taxes during the year and then submit everything to my accountant and he tells me how much money I owe in federal, state, taxes, etc... beyond what I've already paid throughout the year. So, when calculating effective tax rates...
-Do you include FICA, federal, and state taxes for calculating effective rate? I'm assuming add all three up and divide by income? Or do most people only report just the effective rate on federal taxes?
-Where on your tax returns (form a line) can I find the actual numbers that I've paid (federal, FICA, state) so I can compute my tax rate?
-I'm assuming divide by gross income instead of net (before any deductions for HSA, 401k, etc...). Where to locate this number?
-For marginal, is everyone just reporting their federal marginal rate and ignoring any taxes owed to state or FICA?
Thanks!
-Do you include FICA, federal, and state taxes for calculating effective rate? I'm assuming add all three up and divide by income? Or do most people only report just the effective rate on federal taxes?
-Where on your tax returns (form a line) can I find the actual numbers that I've paid (federal, FICA, state) so I can compute my tax rate?
-I'm assuming divide by gross income instead of net (before any deductions for HSA, 401k, etc...). Where to locate this number?
-For marginal, is everyone just reporting their federal marginal rate and ignoring any taxes owed to state or FICA?
Thanks!
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