The New 2018 Tax Law and You

Example: Max 401k and Family HSA

  • Bob has a $150,050 AGI ($200k income - $18,000 401k - $6,750 HSA - $16,500 itemized - 2*$4,350 exemptions).
  • Bob owes $10,452.50+.25*($150,050 - $75,900) = $28,990 in federal taxes [2]
  • Bob has a $150,600 AGI ($200k income - $18,500 401k - $6,900 HSA - $24,000 standard deduction).
  • Bob owes $8,907+.22*($150,600 - $77,400) = $25,011 in federal taxes [3]

Example: No 401k or Family HSA

  • He has a $174,800 AGI (200k income - 16500 deduction - 4350*2 exemptions)
  • He owes 29,752.50+.28*(174800 - 153100) = $35,828.50 [2]
  • He has a $176,000 AGI (200k income - 24000 standard deduction)
  • He owes 28179+.24*(176000 - 165000) = $30,819 in federal taxes [3]

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Personal Finance Expert and Investor, Engineering Leader, and Business Strategist

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Cody A. Ray

Cody A. Ray

Personal Finance Expert and Investor, Engineering Leader, and Business Strategist

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