How much money do you need to make to spend

ValKehl · #1 08-26-2025, 07:18 PM

Quote:

Originally Posted by raulus

It�s a nice guideline, until your average tax rate is 55% like mine.

Nicolo, I don't comprehend how your or anyone's "average" tax rate can be 55%. The highest incremental federal income tax rate is 37%. Even with adding the highest incremental state income tax rate, one is at less than 50%. One's average tax rate is going to be less than the highest incremental tax rate.

Fred · #2 08-26-2025, 09:57 PM

In reading the threads I see it mentioned that if someone had $40K in cards, they could sell all their cards and then purchase a $40K card.

So... what about realized gains on the cards being sold? Can you "technically" sell $40K in cards and have a realized $20K gain and still purchase the $40K card without other resources? Or is this one of those gray areas?

How many people on this board actually claim realized gains on cards they sell?
.
.
.

raulus · #3 08-27-2025, 12:57 AM

Quote:

Originally Posted by ValKehl

Nicolo, I don't comprehend how your or anyone's "average" tax rate can be 55%. The highest incremental federal income tax rate is 37%. Even with adding the highest incremental state income tax rate, one is at less than 50%. One's average tax rate is going to be less than the highest incremental tax rate.

You’re off to a good start. But you’re missing a few bits:

Self employment tax (yep, I’m self employed)
County tax for the homeless
Local tax for preschool for all
Property tax
Bonus Medicare tax

37% for fed plus 10% for state gets you a large way there, even if some of the federal income is taxed at a lower rate. Add in some of these bonus bits and you get over 50% pretty fast.

Luckily, I live in a zero sales tax state, or that could be added to the list to boot.

And if you want to get extra excited, I’ve got phantom income due to being a partner in a partnership. A portion of my share of the partnership’s taxable income gets reinvested back into the business. So I get to pay tax on it, but I get zero cash for that income. So that raises the effective tax rate on my total cash compensation.

tschock · #4 08-27-2025, 01:39 PM

Quote:

Originally Posted by raulus

You�re off to a good start. But you�re missing a few bits:

Self employment tax (yep, I�m self employed)
County tax for the homeless
Local tax for preschool for all
Property tax
Bonus Medicare tax

37% for fed plus 10% for state gets you a large way there, even if some of the federal income is taxed at a lower rate. Add in some of these bonus bits and you get over 50% pretty fast.

Luckily, I live in a zero sales tax state, or that could be added to the list to boot.

And if you want to get extra excited, I�ve got phantom income due to being a partner in a partnership. A portion of my share of the partnership�s taxable income gets reinvested back into the business. So I get to pay tax on it, but I get zero cash for that income. So that raises the effective tax rate on my total cash compensation.

Sounds like you need the new IRS short form.
1 ) How much did you make last year?
2 ) Send it in.

Leon · #5 08-31-2025, 10:37 AM

LOL

And, if you think you are in a 55% tax bracket, you might want to check with a CPA too...

Quote:

Originally Posted by tschock

Sounds like you need the new IRS short form.
1 ) How much did you make last year?
2 ) Send it in.

calvindog · #6 08-31-2025, 12:04 PM

Quote:

Originally Posted by Leon

LOL

And, if you think you are in a 55% tax bracket, you might want to check with a CPA too...

LOL maybe he has very costly real estate taxes and he tossed that in?

raulus · #7 08-31-2025, 05:45 PM

Quote:

Originally Posted by Leon

LOL

And, if you think you are in a 55% tax bracket, you might want to check with a CPA too...

Turns out I am a CPA…

One who happens to pay a lot in taxes. Of course, the counterpoint is that I also make a lot. But anytime someone demands that the rich pay more in taxes, I’m inclined to ask them how much more I should be paying above the 55% of my income that I currently pay in taxes. Part of the fun in living in a high tax state (and city and county), and having a lot of ordinary income.

But I’ll try not to let paying all those taxes interfere with driving my Ferrari.

gunboat82 · #8 08-31-2025, 05:58 PM

Quote:

Originally Posted by raulus

You�re off to a good start. But you�re missing a few bits:

Self employment tax (yep, I�m self employed)
County tax for the homeless
Local tax for preschool for all
Property tax
Bonus Medicare tax

37% for fed plus 10% for state gets you a large way there, even if some of the federal income is taxed at a lower rate. Add in some of these bonus bits and you get over 50% pretty fast.

Luckily, I live in a zero sales tax state, or that could be added to the list to boot.

And if you want to get extra excited, I�ve got phantom income due to being a partner in a partnership. A portion of my share of the partnership�s taxable income gets reinvested back into the business. So I get to pay tax on it, but I get zero cash for that income. So that raises the effective tax rate on my total cash compensation.

The highest federal tax rate with self-employment is just under 42%. That's nothing to sneeze at, but why are you adding property tax? That's not based on income at all.

If you choose to live in a $3M house... yes, you'll pay a lot... but your income doesn't require it. You could choose to live in a modest house and fill it with baseball cards.

raulus · #9 08-31-2025, 07:49 PM

Quote:

Originally Posted by gunboat82

The highest federal tax rate with self-employment is just under 42%. That's nothing to sneeze at, but why are you adding property tax? That's not based on income at all.

If you choose to live in a $3M house... yes, you'll pay a lot... but your income doesn't require it. You could choose to live in a modest house and fill it with baseball cards.

That you could.

Luckily, the property tax is less than 1% of my income. So you can leave it out if you prefer. Won’t move the needle very much.

But don’t forget state income tax and local and county income tax. Those add another 14% to your federal tally.

Plus the phantom income is a real kick in the shorts.

gunboat82 · #10 08-31-2025, 08:38 PM

Quote:

Originally Posted by raulus

That you could.

Luckily, the property tax is less than 1% of my income. So you can leave it out if you prefer. Won�t move the needle very much.

But don�t forget state income tax and local and county income tax. Those add another 14% to your federal tally.

Plus the phantom income is a real kick in the shorts.

I pay a fair bit of taxes too, and it does add up, especially when all my income is from wages and treated less favorably than capital gains or business profits. But if my income ever climbs to the point where I'm taxed over 50%, I'll be grateful from the half-glass-full perspective. It will mean that the marginal utility of my untaxed dollars has decreased.

The people I know with the highest tax bills also have more bedrooms and bathrooms than they need, drive the nicest cars, eat the best food, go on the nicest vacations, and still manage to snag the most desirable collectibles.

They grumble about their money going to other people, but they're doing OK. Hell, I'm doing well enough to buy some luxury cardboard, and my annual salary is just a fraction of their annual bonus.

ValKehl · #11 08-31-2025, 08:41 PM

Nicolo, I see that you include self-employment tax. I may be naive, but I consider the self-employment "tax" to be your required "contribution" toward your eventual Social Security and Medicare benefits, as opposed to an income tax.

raulus · #12 08-31-2025, 10:59 PM

Quote:

Originally Posted by ValKehl

Nicolo, I see that you include self-employment tax. I may be naive, but I consider the self-employment "tax" to be your required "contribution" toward your eventual Social Security and Medicare benefits, as opposed to an income tax.

I suppose we can debate every tax, and whether we receive benefits from it that are commensurate with the price that we pay. In the case of social security and Medicare, I guess we�ll see whether I end up receiving any benefits when we get there. At the moment, I have some real questions in my mind.

Certainly some will suggest that even federal and state income taxes are the price that we pay to live in our society, and we should gladly contribute to such a worthy cause.

Whether you feel like it�s a good deal or a poor deal, it�s still a tax that we have the privilege of paying. As one politician famously said about another tax, �call it bananas if you want; it still felt like a tax to anyone who had to pay it�.

Personally, every dollar that I pay to the government sure seems like a tax to me. And so I�m not afraid to label it as such.

Exhibitman · #13 08-31-2025, 11:13 PM

�But I�ll try not to let paying all those taxes interfere with driving my Ferrari.�

Nice flex.

BioCRN · #14 08-31-2025, 11:22 PM

Quote:

Originally Posted by raulus

Certainly some will suggest that even federal and state income taxes are the price that we pay to live in our society, and we should gladly contribute to such a worthy cause.

I don't have kids. A lot of tax money goes to support an infrastructure to provide for them, from direct investment to the enforcement of more indirect laws and regulations to keep them from getting harmed and help accelerate their progress from little humans to adult humans.

I live in a city. A lot of my taxes go so people can live far from a city yet still have paved roads, schools, utilities, and other perks that their population's tax base could never hope to adequately cover building, much less maintaining afterward...not to mention the above mentioned indirect rules and regulations that brought things like utilities to their communities in the first place.

I've never lived in a disaster area, but my taxes have helped rebuild towns and cities I've never visited or want to visit.

As far as the original question of how much money do you need to make to spend 40K on a baseball card...minimum wage for at least 4 years with a few grand left after taxes to figure out housing/food/etc over those 4 years...or a few days as the a CEO of a major corporation. Personally, I would pick the 2nd option.

BobbyStrawberry · #15 09-01-2025, 03:20 PM

Quote:

Originally Posted by raulus

That you could.

Luckily, the property tax is less than 1% of my income. So you can leave it out if you prefer. Won’t move the needle very much.

But don’t forget state income tax and local and county income tax. Those add another 14% to your federal tally.

Plus the phantom income is a real kick in the shorts.

You could also move to a lower tax state, county and/or municipality, but there's a reason people stay in those higher-tax places, as I'm sure you know. It's almost as if people think it's worth it to pay higher taxes once they realize the benefits that can be provided with that revenue. Most people—including the rich, up to a point—like having nice roads, sidewalks, schools, police fire and emergency services, etc.

raulus · #16 09-01-2025, 03:55 PM

Quote:

Originally Posted by BobbyStrawberry

You could also move to a lower tax state, county and/or municipality, but there's a reason people stay in those higher-tax places, as I'm sure you know. It's almost as if people think it's worth it to pay higher taxes once they realize the benefits that can be provided with that revenue. Most people�including the rich, up to a point�like having nice roads, sidewalks, schools, police fire and emergency services, etc.

I suspect for many of us, it�s as much about family as anything.

I have a friend from New York who claims that there are two types of New Yorkers - those who talk about leaving, and those who have already left. As a California refugee, I suspect similar sentiments would apply to Californians, among others.

BobbyStrawberry · #17 09-01-2025, 04:10 PM

Quote:

Originally Posted by raulus

I suspect for many of us, it�s as much about family as anything.

I have a friend from New York who claims that there are two types of New Yorkers - those who talk about leaving, and those who have already left. As a California refugee, I suspect similar sentiments would apply to Californians, among others.

Yeah, family and work are probably the biggest ones, I would guess. Also the fractured political climate in the country is a barrier for many people too who might otherwise consider changing their state of residence.

While paying lower taxes always sounds great in a vacuum, I consider myself extremely fortunate that I have the $ to participate in a hobby like vintage baseball cards. If some of those dollars go to help those less fortunate, I'm all for it. (And I don't even have a Ferrari!)

OhioLawyerF5 · #18 09-01-2025, 04:32 PM

Quote:

Originally Posted by BobbyStrawberry

You could also move to a lower tax state, county and/or municipality, but there's a reason people stay in those higher-tax places, as I'm sure you know. It's almost as if people think it's worth it to pay higher taxes once they realize the benefits that can be provided with that revenue. Most people�including the rich, up to a point�like having nice roads, sidewalks, schools, police fire and emergency services, etc.

I have all those things in a lower tax location. :shrug:

Exhibitman · #19 09-01-2025, 09:17 PM

LA is like a divorce: expensive because it's worth it. Ya don't see this in cheaper places:

I like to live in a destination city and I pay a 'resort fee' for the privilege. Can't beat the comedy scene in a media capital either.

Similar Threads
Thread	Thread Starter	Forum	Replies	Last Post
Have Christmas money to spend...	wdwfan	1960-1979 Baseball Cards B/S/T	5	12-30-2017 09:08 PM
Spend a little now.....make a ton later!	Joshwesley	Net54baseball Vintage (WWII & Older) Baseball Cards & New Member Introductions	90	07-06-2016 10:29 AM
What kind of budget or money do you spend	Bwarren92989	Net54baseball Vintage (WWII & Older) Baseball Cards & New Member Introductions	66	01-05-2016 09:29 AM
buying autographed 1933 goudey especially hofers big money to spend	milkit1	1920 to 1949 Baseball cards- B/S/T	0	07-04-2009 04:51 PM
What should I spend my money on?	Archive	Net54baseball Vintage (WWII & Older) Baseball Cards & New Member Introductions	6	12-18-2005 12:18 PM