Thursday, February 3, 2011

Letters Home: What percent of a dollar is held back for income tax?

February 3, 1953
Dear Mom, Dad and all,
Well I guess there isn't much news going on over here. I got those books R. sent. We had about 6 inches of snow, but the temperature stays around 30° above. I found out the other day that I am not due for rotation until September. That's 8 long months yet. What do you think of this German paper? I am sending a money order home next week. You can put it in the bank.
I suppose if Jr. goes back to Madison he will be working at Oscar Mayers. I would think R.C. could have some big factory where a person could make a living.[1]  I am planning on going back to Celons if I can work 48 hours or more a week. If they hold out at 40 it's hard to tell where I will be working. Anything but the Army.
We got our withholding statement today. I had $1,043 for a wage and they took out 74.80. We are going to get another statement, and when I do I will send them all home. I shouldn't have to pay anymore. By the way what percent of a dollar is held back for income tax? Is it 20%? [2]
I guess I will have to sign off this time.
Love, V.

[1] R.C. is Richland Center, his hometown.

[2] Here's a form 1040 for 1953 which shows that the tax rate for his income was well below 10%. link  Still, the tax code was much more progressive in the 1950s. The top tax rate for income above $300,000 was around 91%. That's not say that someone earning that much in 1953 was taxed at that rate on all their income--just what they made above that amount. Note also that the poor paid a fair share. Link.

Here are some interesting comparative cost-of-living numbers I got from a pamphlet I picked up tonight at a Borders Bookstore called 1953 Remember When...

New House                               $9,525.00
Average Income                        $4,011.00
New Car                                    $1.651.00
Average Rent                            $83.00
Tuition to Harvard University   $600 per year
Movie Ticket                             70¢ each
Gasoline                                     20¢ per gallon
1st Class US Postage                 3¢ each

Granulated sugar                        85¢ for 10 pounds
Vitamin D Milk                          94¢ per gallon
Ground Coffee                           76¢ per pound
Bacon                                            55¢ per pound
Eggs                                              24¢ per dozen
Fresh Ground Hamburger          54¢ per pound
Fresh Baked Bread                     16¢ per loaf

Everything is inflated by at least a factor of ten or more, including our egos.  The Judds sing about it here.

1 comment:

  1. In 1953 there was the Korean War and the (then more immediate) specter of nuclear war -- people were still people with their gaffs, gripes and foibles -- but all that notwithstanding, it seemed to be a gentler time.