Wow, I was googling to show an example of the tax brackets and found this web page. It lists tax brackets from 1913-2011. Our tax rates have fluctuated wildly over the years. Check out 1954-1963 when the highest tax bracket was 91%.
http://taxfoundation.org/article/us-...usted-brackets
But, this is the 2013 bracket. So if you make $500,000, you will pay:
Rate Single Filers
10% $0 to $8,925 you pay 10% of 8925= 892.50
15% $8,925 to $36,250 you pay 15% of 36250-8925 = 4098.75
25% $36,250 to $87,850 you pay 25% of 87,850-36,250= 12,900
28% $87,850 to $183,250 you pay 28% of 183,250-87850= 26712
33% $183,250 to $398,350 you pay 33% of 398,350-183,250= 70,983
39.6% $400,000 and up you pay 39.6% of 500,000- 400,000= 39,600
So you add those up and you're paying $155,186.25 which is actually a 31% tax rate when you average it out.
You're only taxed at a 39.6% rate for the money you make over $400,000.