Quote:
Originally Posted by pilotbob
Hmm... I just don't think they were very smart then. The withholding tables are progressive, so you can't take home "less" if you make more.
BOb
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Actually, between phasing out of certain deductions jumping into higher brackets and some other odd effects it was quite possible to lose money by making more. Not common, but quite possible.
More likely, they simply thought that the money earned via overtime wasn't worth the extra hours at work -- at least not when discounted for their particular marginal tax rate. Depending on what year it was, top marginal tax rates got pretty steep. I can remember 70% as the top rate (although I never paid it!); it's been as high as 91% in my lifetime. See
the Tax Foundation's web site for details.
Xenophon