It's a common misconception among people who haven't done even the slightest bit of research. Or done their taxes themselves. Confidently stating stuff that is obviously false SHOULD be ridiculed.
As someone who does his taxes manually every year, this probably wouldn't help. Most people would be under the threshold and just look up the value in a table and not see how it scales.
If you use any sort of tax software I expect it's even further obscured.
I hate to agree with the ridicule point, but honestly ridicule also deters other people from making a similar mistake.
I agree ridicule should be used cautiously, but in a case like this where someone speaks so confidently and boldly gives advice on a topic they clearly do not understand, I think ridicule is a good way not only to inform them, but also indicate to others that it's not okay to give people this kind of advice unless you have a basic understanding of the topic.
I have nothing to back this up but the reason I'm sensitive to ridicule as an initial reaction is that I believe it causes people to shy away and there's potential that they surround themselves with other ridiculed people and now you have a group that is intentionally dense and now powerful. Education should always be the first step.
I grew up in rural appalachia and the amount of grief than the uneducated get there for being uneducated causes them to become even more hostile and I really think that the Mr Rogers approach of education would eventually neuter any hostility they had towards the educated.
An educative reply is easier to ignore than a (or multiple) replies in which you're ridiculed.
Moreover, being thought about how you're wrong about X might not necessarily translate in the subject being more careful before confidently expressing themselves on a Y topic on which they don't know anything about. Hopefully, ridiculing might make the subject reconsider that part of their character.
That said, the HN policies recommend to "be kind"... I have no idea how to "ridicule someone's post in a kind way" ¯\_(ツ)_/¯
I don’t think I see the same pile of downvotes that you’re seeing? My comment of ridicule got +10 votes in 15 minutes before I edited it, and now is down to +9 an hour after editing the ridicule out.
I see that “Calm down. It's a common misconception” did get downvoted.
Apparently this belief is far more common than I thought. I expected it to be closer to the percentage of Americans who think the Earth is flat (10%)[0]. Evidently 50% of Americans[1] believe you pay your highest marginal rate on all of your income. I'm blown away, and genuinely humbled. I don't understand how someone can get a Fannie Mae/Freddie Mac home loan, raise children, have a long and successful career and not understand tax brackets -- I clearly am incredibly out of touch with how some people live their lives, and I have a lot to learn about other people.
There is a class of rich people in the US who really like that people believe this. It allows them to spread a lot of fear about higher tax rates for high incomes.
Not to mention the influence of companies like Intuit, which has been pushing against convenience in tax filing for decades because its entire business model relies on people being unwilling or unable to file by themselves: https://www.propublica.org/article/inside-turbotax-20-year-f...
It seems to be advantageous to a significant portion of the political class that people hold this misconception - this type of misconception explains much of the widespread public support for tax breaks for the ultra-rich...
It was preached to me that this was how it worked since I started working in the mid-90s. I didn't learn better until an accountant friend clarified that when I got him to do my taxes when I started making real money in the mid-00s.
I dare say that it was probably the most common understanding until fairly recently. The internet has probably helped a lot with that. That is to say, if you're of a certain generation you probably think this way because that's what was generally understood.
I guess it's a fair assumption you never once attempted to calculate your own taxes in the first decade of filing taxes? Did you just drop some papers off to an accountant the first year that you reached adulthood?
I've used an accountant occasionally, but only when I had genuinely confusing tax issues involving international work or work across many states where I wasn't sure whether there existed a "nexus" that required me to pay taxes in State A or State B. Even then I did my best to double-check their work, and often caught errors/omissions. Most of my friends also do their own taxes (and have since 2006), regardless if they were line cooks or painters or engineers or MBB consultants. So I'm just not familiar with the lifestyles that lead to this.
I'd actually understand it more for people who've entered the workforce since 2005, because TurboTax/etc became much more popular. I did taxes with my dad in the mid-90's before most homes had internet, and back then it seemed far more likely that people would understand how taxes worked, because there wasn't super-easy software to do it for you.
If you're in the lowest tax bracket making just above the poverty line, as I was then (as well as most people around me), it was what we all understood to be.
I was in that tax bracket for half my adult life (often did not have enough money to eat chicken and rice at home and just went hungry). I had to do my own taxes because I couldn’t afford an accountant and TurboTax starting taking the piss on their dark pattern pricing schemes. All of my friends at the time were also very poor, it was a giant recession and we worked in restaurants that weren’t getting customers. We got paid $2.65/hr so if we actually had a “good week” our paychecks were $0 (actually negative, honestly, but paychecks bottom out at $0) due to taxes on tips.
Now I’m even more confused. Accountants were genuinely expensive and none of my peers in my economic class could afford one.
At the risk of repeating myself: how did you file taxes for the first decade of adulthood? If you were too poor pay an accountant like I was…how did you misunderstand how to calculate taxes owed for ten years, but still arrive at the correct amount to pay? Did the IRS often return money to you saying that you over-paid? Did anyone ever try to correct your misconception?
I’m trying to understand this in more detail than just “memorize the fact that 50% of Americans were lied to by (someone?) about taxes, and also just blindly accept that there is some magic unknown to me which allowed them to not be affected by that misunderstanding through most of their adult life”.
You were in poverty when you had this misunderstanding. This other commenter bought a house while they had the same misunderstanding. (So, “being poor” isn’t the experience you both had in common while holding this misconception and can’t explain it for both of you). I’m trying to understand how that misunderstanding never affected either of you. I’m trying to understand how neither of you ever had to read about how to calculate taxes owed.
When you're in that tax bracket, there are plenty of tax break/benefit cliffs that are more impactful than tax rates. And they can certainly make your take-home pay go down if you accept a raise. See:
But that still doesn't explain the common denominator between a person living comfortably and a person in poverty both not understanding how tax brackets work or ever having to consider the most basic parts of how their own taxes are calculated, for so, so many years of their lives.
Well around 40% of households don't pay federal taxes at all, and presumably a large chunk of those who do are in the lowest tax bracket so they might not ever need to know how it actually works.
