I just finished my Federal taxes for 2012 .....

[FreeJoe]

34. Rates

It's hard to calculate true rates. My "Effective Tax Rate" according to Turbo Tax was 20.85%.

That's just what I paid in federal income tax divided by my Adjusted Gross Income. It doesn't include FICA or Medicare taxes. It doesn't include the "employer paid" portion of either of those taxes. It doesn't include deferred income like 401K contributions, 401K matching contributions, gains inside of retirement accounts or college savings accounts, or pension contributions. It doesn't include tax free income inside of a Roth IRA. It doesn't include health savings account contributions or income. It doesn't include income from qualified dividends. It doesn't include non-taxable benefits like medical, vision, or dental insurance and a portion of my company paid life insurance. It doesn't include stock options that haven't been exercised or stock grants that haven't vested. It doesn't include unrealized capital gains. I'm sure that other people have lots of other income excluded from taxation as well, so it is hard to really compare apples-to-apples.

If I wanted to make my best guest comparison of total realized income this year (excluding deferred income that will be taxed someday in the future and income inside of 529 and Roth plans) compared with total federal taxes (income, FICA, Medicare), I think the rate would work out to something like 22.5%.