Total tax paid
$2,416
Did you know your employer also pays tax on your salary? It costs the employer $489 to pay you $8,700. In other words, every time you spend $10 of your hard-earned money, $2.78 goes to the government.
Real tax rate
26.3%
So, with you and the employer both paying tax, what used to be a 22.2% tax rate now rises to 26.3%, meaning your real tax rate is actually 4.1% higher than what it seemed at first.