Did you know your employer also pays tax on your salary? It costs the employer $600 to pay you $20,000. In other words, every time you spend $10 of your hard-earned money, $1.71 goes to the government.

So, with you and the employer both paying tax, what used to be a 14.1% tax rate now rises to 16.6%, meaning your real tax rate is actually 2.5% higher than what it seemed at first.