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Revision as of 09:30, 3 September 2024

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If purchase a national muni bond fund your interest income will be free of federal income tax (but not state income taxes). In case you buy circumstances muni bond fund that owns bonds from your personal home state this interest income will likely be "double-tax free" for both federal and state income .

The 'payroll' tax applies at a constant percentage of your working income - no brackets. For employee, you pay 6.2% of the working income for Social Security (only up to $106,800 income) and a person specific.45% of it for Medicare (no limit). Together they take much more 7.65% of one's income. There's no tax threshold (or tax free) associated with income for this system.

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