[net.taxes] Tax Tables and Rate Schedules

wjm@whuxj.UUCP (MITCHELL) (04/05/84)

OK guys, I stand somewhat corrected.
While my original statement about the United States tax laws providing a
piecewise continuous function - thus always making it worthwhile (in theory)
to earn an additional dollar is correct, there is the problem that the IRS
tax tables are divided into $50 chunks, and the tax for each chunk is computed
at the midpoint value, thus it may be possible to have to pay several dollars
more if you go from one table entry to another with a $1 increase in income.
Also, the IRS requires you to use the tax tables if you don't meet several
conditions (income averaging and earning more than $50K are the two that
immediately come to mind), so this could be a problem.  (This, by the way
is a rather recent change - the IRS used to give you the option of using
the tax tables or rate schedules.)
By the way, if you are very close to a table entry boundary, remember that the
IRS gives you the option of rounding amounts off to whole dollars (.00 to .49
round down, .50 to .99 round up) - it may help.
Aside to Wally Dietrich - for most of us humans, an occasional error is a
fact of life, at least try to spell my name right in the comments (2 'l's,
please).
Bill Mitchell
Bell Communications Research, Inc.
Whippany, NJ (whuxj!wjm)