Tax Law Changes Equals Increasing Paychecks

For a single person earning $50,000 per year (assume all wages/salaries and no adjustments), his federal individual income tax bill under 2007 tax parameters would be calculated as follows:

AGI = $50,000

Income Tax After Credits for 2007 tax law = $6,736.25

Now for a person earning $50,000 under the 2008 tax parameters:

AGI = $50,000

Income Tax After Credits for 2007 tax law = $6,606.25

The person would save $130 on the year assuming no pay change, which would be about a $5.42 pay increase per pay period (assuming two per month).

source: Tax Foundation


It is not much, but declining tax bills are good. Although I'm not holding my breath.