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Taxes and rent are still bigger. For a senior FAANG engineer making $400k a year, CA income taxes are nearly $40k/year, and rent on a house is perhaps another $
by exged 6y ago
Taxes and rent are still bigger. For a senior FAANG engineer making $400k a year, CA income taxes are nearly $40k/year, and rent on a house is perhaps another $60k/year (alternatively, ~$100k/year for a mortgage). All other basic needs are a rounding error compared to that, even with a family.
- rootsudo 6y agoIt took me a second to realize you just meant California State taxes....
- andi999 6y agoWait, you only pay 40k tax on 400k? Or how much other taxes on salary are there in the US?
- mythz 6y agoHe's just talking about California State Taxes, not Federal Income Tax.
- glenngillen 6y agoThat’s just state tax (CA being one of the highest). They’ll have to pay the same federal rates as everyone else on top of that. I assume the reason for excluding it is that’d stay constant no matter where you live in the US.
- andi999 6y agoSo how high would this be?
- weebwoobfly 6y agoProbably between city, state, and federal just under 50% total.
- DavidPeiffer 6y agoBad math, 110k in federal taxes and 15k in FICA (social security, Medicare, Medicaid). https://smartasset.com/taxes/income-taxes https://smartasset.com/taxes/income-taxes
- dmode 6y agoI earn comparable salary. I paid ~20k in taxes last year. There is a ton you can deduct. And the tax rate is progressive.
- exged 6y agoCorrect me if I'm wrong, but the biggest CA income tax deduction available to most people is the mortgage interest and property tax deductions. So yes, you can deduct a lot of your state taxes - provided you're spending even more on an expensive home. And yes, the tax rate is progressive, but the average rate is still around 9% at that income level (~36k). Marginal rate is just over 11%. My overall point is just that almost all of the cost of living delta in CA is from taxes and housing. Didn't mean to get too deep into the numbers.