The source of the USA Today's preposterous advice?
A book titled "Math for Grownups." I kid you not.
That raise actually might not be as good as it looks. The extra money is nice, but it could very well bump you into the next tax bracket, possibly leaving you with less money than you had before the raise.
Dean Baker, Jon Chait and Matthew Yglesias marvel at the sheer stupidity of those two sentences; the whole point of marginal tax brackets is to make sure that even as you pay a higher percentage of your income in taxes, your net income continues to grow.
USA Today has now posted a clarification, but instead of admitting that they were wrong, they've dug in their heels, posting several pages from their original source, a book written by Laura Laing which they say offers a more "complete explanation" of the concept they were trying to convey. According to the book, appropriately titled Math for Grownups, a raise is "not always" a good thing:
Getting a raise is always a good thing, right? Well, not always. If that extra cash in your paycheck bumps you into the next tax bracket, you could be giving more in taxes to Uncle Sam than you'd like.
Okay, so "giving more in taxes to Uncle Sam than you'd like" is a meaningless statement, but getting a raise is "not always" a good thing? That's absurd! Of course it's a good thing, at least if money is your bottom-line. Otherwise Sarah Palin would never have quit her job as governor.
But Laing argues that instead of seeking a raise, you should make a counteroffer. Based on this logic, you'd think she'd advise you to ask for a ten percent pay cut, but she's not quite that crazy. Instead, she suggests "asking for another week of vacation" or a requesting a "VIP parking space."
Of course, if the parking spot actually has real cash value, then it's a benefit—and must be reported to the IRS. Which means it'll get taxed as if it were income. So if you follow her advice, you might end up with higher taxes even though you didn't get a raise. But at least you'd have a VIP parking spot. And you'd have the pride of being the mathematical adult in the room.
