John works a 40 hour a week job and is thinking of taking on a second weekend job. However, he%26#039;s concerned that the small income he%26#039;ll make at the second job will just be a waste because it%26#039;ll knock him into a higher tax bracket and just screw him over during tax time. John has a wife and one child to claim, but will not qualify for EIC. Will taking on a low-income second job really not be worth the time because of this?|||Unless he is in a marginal tax bracket that is greater than 100% which he is not, having a second job will bring more money to the household after taxes are considered.|||Sure, there are times when $1 in additional income can increase your taxes several hundred dollars. If for example he qualifies for a Savers Credit of $200, but he goes out and earns $50 working one weekend, and that disqualifies him from the Savers Credit, he has earned $50 and lost $200.
He will need to go over all of his tax issues, including deductions and credits, as well as the increase in income taxes owed, before deciding if the extra income is going to benefit him.|||You also need to consider other variables ..... transportation costs, babysitter, food, dry cleaning, time, etc. add all of these to the tax situation and it might not pay to have that second job. Use the time to attend night school and earn a degree and get a better / higher paying job.|||any accountant can explain to you the tax brackets, without you stating specific income amounts, you%26#039;d have to speak with your accountant. my guess is that if you need a second weekend job, you%26#039;re not making very much money during the week, so you probably won%26#039;t get put into a higher tax bracket.|||As we have a progressive tax system, you can not possibly come out behind by making more money.|||If he does not qualify for EIC anyway so there%26#039;s no chance of losing money because of that, he%26#039;ll definitely keep a large portion of the additional money after taxes. Only he can determine what additional costs he might have such as transportation, and what the extra time is worth for him.
Being %26quot;knocked into a higher tax bracket%26quot; isn%26#039;t really a consideration, although many people misunderstand how tax brackets work. He%26#039;ll pay the same on his already existing income. If his additional income takes him into a higher bracket, the only income he%26#039;ll pay the higher rate on is the part of the additional income that goes into the higher bracket.|||Perhaps, depends on the hours, the hourly wage, the distance traveled back and forth, etc......Sometimes it%26#039;s best to just budget yourself and cut costs at home. Not worth the extra money if your dead tired all the time and have no time to spend with family cause your always working.|||Even if he were in a higher tax bracket, he could do things like contribute to a tax deductible IRA or some such.
Plus if you are taking on a second job to pay down high interest credit cards or loans, there is no way this wouldn%26#039;t be a good idea.|||Of course he%26#039;s going to make more money. Where do you think you live? Sweden?
The question though, is is it worth it? Why not just jump off a bridge? I mean really, why live life if you can%26#039;t spend time with your loved ones? That is the beauty behind social systems that work. Did you know Germans have a minimum, MINIMUM ! of 6 weeks paid vacation per year? That goes for the janitors too. New mothers... a year maternity leave! And that goes for most of north western europe.
Progressive tax system my ****.|||You can make lots of money. Even though you will get screwed come tax time at least the $ is sitting in your account collecting interest.
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