September 29, 2025 • 11 mins
It’s the Season 5 finale of Pink Money! In this episode, Jerry breaks down one of the most misunderstood topics in personal finance: how taxes actually work. From U.S. progressive brackets to global flat tax systems, Jerry explains why your last dollar doesn’t put your whole paycheck in a new bracket, why deductions matter, and why “simple” tax systems aren’t always fair.
Along the way, he highlights how states like Texas balance no income tax with high property and sales taxes, why federal cuts often circle back to you through state taxes, and why understanding the system helps you avoid voting against your own best interests. Whether you’re a W-2 employee, a self-employed gig worker, or just curious about how taxes hit your wallet, this episode will give you the tools to think critically, plan smartly, and head into tax season prepared.
And with this, Season 5 wraps up—get ready for new insights, stories, and surprises in Season 6 of Pink Money!
💬 Have a question or comment? Contact Jerry here
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_00 (00:00):
The following podcast is for entertainment and
educational purposes only.
Remember to seek competent tax,legal, and investment advice
that is unique to your personalsituation.
(00:22):
Hey, welcome to the Pink MoneyPodcast, and I'm your host,
Jerry Williams.
We talk about all things relatedto money from a queer
perspective.
And today I wanted to talk abouttaxes, really.
So it kind of stuck in my mind afew things when I was reviewing
the 2024 tax charts, and it justreminded me that we're in a
(00:42):
progressive tax system.
And that just means that yourvery last dollar of your income
could put you in a totallydifferent tax bracket.
It doesn't mean that your totalincome is taxed in that bracket.
It just means that it'sprogressively broken up into
these brackets and then taxedaccordingly.
So that's also true for othercountries as well.
(01:02):
Many countries have progressivetax systems like Canada,
Germany, the UK, but some placesalso have a flat tax, and that
just means everybody pays taxesat the same rate.
One of the highest in the world,I believe, is uh Ivory Coast,
where their tax rate issomething really high, like 60%.
But there's other countries aswell that have a very high tax
(01:24):
rate as well, you know, like theNetherlands, et cetera.
But a lot of people don't like aflat tax system because they
really think that it's unfair.
Because if we're all payingtaxes at the same amount,
meaning what let's say you'reonly only earning 30,000,
someone's earning 300,000, butwe're all paying taxes at the
same rate.
(01:44):
So obviously you're paying agreater burden on you at that
tax versus someone who's payingmuch smaller amount at that much
higher income.
So, but a lot of places theyfind that a flat tax system is
just simple and easy.
And it's true, but again, isthat really the fairest way?
(02:04):
I don't know.
I guess that's up to debate foranother day in time.
But the deductions, let's say,even if you're in the 37% tax
bracket, will typically reduceyour total income down so that
you probably aren't going to bepaying taxes in the 37% tax rate
anyway.
I think most people, even those,like I said, that fall in the
(02:27):
37% ultimately pay somethinglike 21 to 24% of you know
that's their actual tax ratethat they fall into ultimately.
But uh some people, you know,itemize, some people don't, some
people just take the standarddeduction, etc.
It's just one of those things.
But you know, I'll one thingthat I find is curious is that
(02:50):
people in the highest taxbrackets actually pay 60% of the
total taxes paid.
So I again debatable however youwant to see it, but you know,
there's also states likeColorado and they have a flat
tax, and there's other stateslike Texas, and they don't have
a state tax.
But whether it's a flat tax orsales tax or a property tax,
(03:12):
somewhere, somehow, thegovernment is gonna get their
money from the citizens.
They're gonna get it from you,right?
But what you really have toconsider as well when you're
thinking about taxes is how mucham I actually paying?
And that's not always asclear-cut as that may seem
because again, there's differentways that you can actually pay
your taxes.
Like you go to the grocerystore, right?
(03:33):
And then you pay taxes on yourgroceries.
That's the sales tax.
And in Texas, it can go as highas 8.25% in total taxes.
But property taxes in Texas arealso very high because, again,
they have to offset the factthat there is no state tax.
So even so, you know, manypeople they clamor for the
federal government to get outcertain industries, let's say
(03:54):
education.
You know, there's a whole pushto dismantle federal departments
like education, energy, and uhothers.
But, you know, if all thesedepartments, you know, seemingly
go away, it doesn't mean thatsomehow, some way that this the
assistance that they provide,you know, doesn't completely go
away.
It just means it goes, it'spushed back to the states and
(04:18):
ultimately it's pushed back toyou.
So the more that disappears atthe federal level level, well,
you know, if it goes back to thestate level, then ultimately
it's gonna go back to you.
So those are one of the pitfallsyou have to really think about
when people really are talkingabout, hey, let's get rid of
(04:38):
this.
Let's have a much smallerfederal government, and you
know, this is a better way togo.
States can do much better job,blah, blah, blah, blah, blah,
blah, blah, blah.
So I don't want to debate that.
I'm just saying if those thingsgo away, they don't completely
go away, they really circle backand go to you.
So, well, that means again,you're just gonna be paying
(04:59):
higher taxes.
In other states, let's say, youknow, Arkansas, Kansas,
Nebraska, Iowa, you know, thosestates are experiencing some
problems, meaning their citizensare farmers, you know, they
actually receive a large chunkof assistance from the federal
government.
And that helps them to continueto, you know, provide food for
(05:22):
the U.S.
and actually a lot of places allaround the world.
And when that goes away, thenthe farmers go away.
So unless the state steps in orthe government steps in to help
these farmers, they'll justsimply go bankrupt and they
won't be able to provide foodany longer, something that
they've done for generations.
So there's a real danger there.
(05:43):
So bringing it all backtogether, I'm just saying that
you have to pay your fair shareof taxes, right?
Okay.
You can pay it all at once, oryou can pay it systematically
throughout the year.
You know, if you're a W-2person, then of course, you
know, your employer takes itautomatically out of your check
and you don't really see it, andyou don't really worry about
your taxes until, you know, theApril 15th deadline.
(06:03):
But, you know, that's when youhopefully get a refund and you
don't owe anything.
But if let's say you're aself-employed person, you know,
uh 1099, you know, nobody'sgonna be doing any withholding
for you, and you have to do ityourself.
And even let's say if you're afood delivery person, you drive
for Uber or you know, whateverkind of 1099 gig you got on, if
(06:23):
you're self-employed, then youhave to pay quarterly taxes.
So that's just how thegovernment sets it up so you're
not faced with a huge tax billon April the 15th or whatever
your tax filing deadline is.
So you just want to make surethat again, you don't get into a
bind when you have to pay thesetaxes all at once.
So you want to pay your fairshare when you have to pay it,
(06:46):
etc.
But again, it doesn't mean thattaxes that you pay at the end of
the year are all the taxes thatyou pay, right?
I mean, I think everybody knowsthat, but it doesn't mean
anybody's really gonna get awaytotally, you know, scot-free
from paying taxes.
So even let's say if you're arenter and you don't own any
property, but whomever owns thatapartment building or the land
(07:09):
that it sits on, you know, theypay property taxes.
And what they're gonna do ispass those costs back on to you,
and it's gonna be passed on tothe renters, so they actually
pay your his property taxes forhim.
It's just baked into yourmonthly rent.
So you don't get any taxdeduction, right?
But he gets one, right?
Because that's just how the taxsystem works.
(07:30):
Fair or not, it's just how itgoes.
But you know, uh what I thinkthat we want to really
reconsider when we're talkingabout, you know, should these
various federal agencies bedismantled and pushed back to
the states?
I mean, is that kind of cuttingyour nose off to you know spite
your face?
(07:51):
Because, you know, when youthink about it in a holistic
sense, and when you want toreally push for a smaller
government, you know, again,this ultimately comes back to
you and ultimately is going tomean higher taxes.
And that's one of the missingkey components.
I don't think that's very easilyunderstood by the general
public, nor is I think it veryexplained well uh by any
(08:15):
politician, you know, becausethey may not even understand it
themselves and they may not haveeven thought through it from A
to Z either.
And they're not very likely tostep in front of you and say,
hey, by the way, we're gonna getrid of this department and all
those costs are just gonna goback to you, right?
No, of course not.
They're not gonna say anythinglike that.
They're gonna say, hey, we didthis, we got rid of this, that
just means a smaller government,so hooray for us, right?
(08:37):
And they'll leave it at that.
And then when it comes back toyou, you're like, maybe we
shouldn't have done that, right?
But it's too late, it's alreadybeen done.
So we don't want to putourselves in that situation
unless we truly are acceptingthe facts and we understand the
full ramifications of what we'rereally asking for.
It could be a case of again, becareful what you asked for
(08:58):
because you just might get it.
And you don't want to end up onthe street yourself, you know,
because of some of the decisionsthat were made that you didn't
fully understand, and you wereessentially voting against your
own best interests.
And we've certainly seen thathappen many, many times,
especially fairly recently.
But again, another topic foranother day.
(09:19):
But not to be an alarmist, but Ithink that it's it behooves us
to really understand how thesethings work, and that can help
you make the best decisions foryourself, and then you can push
for those who represent you tomake the best decisions, not
only for you, of course, butyour community, your state, your
nation.
You know, you really want to beknowledgeable about how, again,
(09:42):
these things work and howthey're ultimately going to
affect you.
And the best that you can do isuse your critical thinking
skills and ask questions so thatyou're not blindsided and you
feel that you really have a fullgrasp of everything that's going
on.
Period.
And even if you don't understandeverything, then do a little bit
of homework, right?
Go to other people who seeminglyhave a better idea of what's
(10:05):
happening, maybe read somestuff.
You know, get as muchinformation as you can.
That's all I'm saying, right?
I'm just saying that the moreeducated we are, the more
knowledgeable we are, the betteroff we're gonna be.
And that's just you can just saythat for practically everything.
So that's really my spiel fortoday.
I don't want to go on and onabout it.
I think you got the whole pointhere.
(10:26):
But as we approach the end ofthe year, it is a good idea to
start thinking ahead about, youknow, your uh taxes that are
gonna be due, especially againif you're self-employed,
reducing your tax bill, youknow, contributing to your IRAs,
all those kind of things, doingsome tax harvesting.
Work with your investmentadvisor, work with your tax
advisor, etc., to be fullyprepared and put yourself in the
(10:50):
best situation.
So you pay what you owe, youdon't pay more than what you
should owe, right?
You don't want to do that.
It's not fair.
So one last thing I'm gonnaleave with is this is the finale
for season five, which is prettycool for me.
I'm glad about that.
We've got five years under thebelt.
But heading into season six,I've got a few things that are
(11:12):
on the horizon, a few thingsthat I think you'll find
helpful, useful, entertaining.
And some of them are already outthere.
And you can go to the websitewww.pinkmoney.com,
pinkmoneypodcast.com, pardon me.
I should know my own website.
Anyway, so go to the website,take a look at some of these
things.
I hope that you'll find againthem useful and entertaining.
(11:35):
But I think that's pretty muchfor me today.
And other than that, I hope youhave a great day and I will talk
to you next time.
The following podcast is for entertainment and
educational purposes only.
Remember to seek competent tax,legal, and investment advice
that is unique to your personalsituation.
(00:22):
Hey, welcome to the Pink MoneyPodcast, and I'm your host,
Jerry Williams.
We talk about all things relatedto money from a queer
perspective.
And today I wanted to talk abouttaxes, really.
So it kind of stuck in my mind afew things when I was reviewing
the 2024 tax charts, and it justreminded me that we're in a
(00:42):
progressive tax system.
And that just means that yourvery last dollar of your income
could put you in a totallydifferent tax bracket.
It doesn't mean that your totalincome is taxed in that bracket.
It just means that it'sprogressively broken up into
these brackets and then taxedaccordingly.
So that's also true for othercountries as well.
(01:02):
Many countries have progressivetax systems like Canada,
Germany, the UK, but some placesalso have a flat tax, and that
just means everybody pays taxesat the same rate.
One of the highest in the world,I believe, is uh Ivory Coast,
where their tax rate issomething really high, like 60%.
But there's other countries aswell that have a very high tax
(01:24):
rate as well, you know, like theNetherlands, et cetera.
But a lot of people don't like aflat tax system because they
really think that it's unfair.
Because if we're all payingtaxes at the same amount,
meaning what let's say you'reonly only earning 30,000,
someone's earning 300,000, butwe're all paying taxes at the
same rate.
(01:44):
So obviously you're paying agreater burden on you at that
tax versus someone who's payingmuch smaller amount at that much
higher income.
So, but a lot of places theyfind that a flat tax system is
just simple and easy.
And it's true, but again, isthat really the fairest way?
(02:04):
I don't know.
I guess that's up to debate foranother day in time.
But the deductions, let's say,even if you're in the 37% tax
bracket, will typically reduceyour total income down so that
you probably aren't going to bepaying taxes in the 37% tax rate
anyway.
I think most people, even those,like I said, that fall in the
(02:27):
37% ultimately pay somethinglike 21 to 24% of you know
that's their actual tax ratethat they fall into ultimately.
But uh some people, you know,itemize, some people don't, some
people just take the standarddeduction, etc.
It's just one of those things.
But you know, I'll one thingthat I find is curious is that
(02:50):
people in the highest taxbrackets actually pay 60% of the
total taxes paid.
So I again debatable however youwant to see it, but you know,
there's also states likeColorado and they have a flat
tax, and there's other stateslike Texas, and they don't have
a state tax.
But whether it's a flat tax orsales tax or a property tax,
(03:12):
somewhere, somehow, thegovernment is gonna get their
money from the citizens.
They're gonna get it from you,right?
But what you really have toconsider as well when you're
thinking about taxes is how mucham I actually paying?
And that's not always asclear-cut as that may seem
because again, there's differentways that you can actually pay
your taxes.
Like you go to the grocerystore, right?
(03:33):
And then you pay taxes on yourgroceries.
That's the sales tax.
And in Texas, it can go as highas 8.25% in total taxes.
But property taxes in Texas arealso very high because, again,
they have to offset the factthat there is no state tax.
So even so, you know, manypeople they clamor for the
federal government to get outcertain industries, let's say
(03:54):
education.
You know, there's a whole pushto dismantle federal departments
like education, energy, and uhothers.
But, you know, if all thesedepartments, you know, seemingly
go away, it doesn't mean thatsomehow, some way that this the
assistance that they provide,you know, doesn't completely go
away.
It just means it goes, it'spushed back to the states and
(04:18):
ultimately it's pushed back toyou.
So the more that disappears atthe federal level level, well,
you know, if it goes back to thestate level, then ultimately
it's gonna go back to you.
So those are one of the pitfallsyou have to really think about
when people really are talkingabout, hey, let's get rid of
(04:38):
this.
Let's have a much smallerfederal government, and you
know, this is a better way togo.
States can do much better job,blah, blah, blah, blah, blah,
blah, blah, blah.
So I don't want to debate that.
I'm just saying if those thingsgo away, they don't completely
go away, they really circle backand go to you.
So, well, that means again,you're just gonna be paying
(04:59):
higher taxes.
In other states, let's say, youknow, Arkansas, Kansas,
Nebraska, Iowa, you know, thosestates are experiencing some
problems, meaning their citizensare farmers, you know, they
actually receive a large chunkof assistance from the federal
government.
And that helps them to continueto, you know, provide food for
(05:22):
the U.S.
and actually a lot of places allaround the world.
And when that goes away, thenthe farmers go away.
So unless the state steps in orthe government steps in to help
these farmers, they'll justsimply go bankrupt and they
won't be able to provide foodany longer, something that
they've done for generations.
So there's a real danger there.
(05:43):
So bringing it all backtogether, I'm just saying that
you have to pay your fair shareof taxes, right?
Okay.
You can pay it all at once, oryou can pay it systematically
throughout the year.
You know, if you're a W-2person, then of course, you
know, your employer takes itautomatically out of your check
and you don't really see it, andyou don't really worry about
your taxes until, you know, theApril 15th deadline.
(06:03):
But, you know, that's when youhopefully get a refund and you
don't owe anything.
But if let's say you're aself-employed person, you know,
uh 1099, you know, nobody'sgonna be doing any withholding
for you, and you have to do ityourself.
And even let's say if you're afood delivery person, you drive
for Uber or you know, whateverkind of 1099 gig you got on, if
(06:23):
you're self-employed, then youhave to pay quarterly taxes.
So that's just how thegovernment sets it up so you're
not faced with a huge tax billon April the 15th or whatever
your tax filing deadline is.
So you just want to make surethat again, you don't get into a
bind when you have to pay thesetaxes all at once.
So you want to pay your fairshare when you have to pay it,
(06:46):
etc.
But again, it doesn't mean thattaxes that you pay at the end of
the year are all the taxes thatyou pay, right?
I mean, I think everybody knowsthat, but it doesn't mean
anybody's really gonna get awaytotally, you know, scot-free
from paying taxes.
So even let's say if you're arenter and you don't own any
property, but whomever owns thatapartment building or the land
(07:09):
that it sits on, you know, theypay property taxes.
And what they're gonna do ispass those costs back on to you,
and it's gonna be passed on tothe renters, so they actually
pay your his property taxes forhim.
It's just baked into yourmonthly rent.
So you don't get any taxdeduction, right?
But he gets one, right?
Because that's just how the taxsystem works.
(07:30):
Fair or not, it's just how itgoes.
But you know, uh what I thinkthat we want to really
reconsider when we're talkingabout, you know, should these
various federal agencies bedismantled and pushed back to
the states?
I mean, is that kind of cuttingyour nose off to you know spite
your face?
(07:51):
Because, you know, when youthink about it in a holistic
sense, and when you want toreally push for a smaller
government, you know, again,this ultimately comes back to
you and ultimately is going tomean higher taxes.
And that's one of the missingkey components.
I don't think that's very easilyunderstood by the general
public, nor is I think it veryexplained well uh by any
(08:15):
politician, you know, becausethey may not even understand it
themselves and they may not haveeven thought through it from A
to Z either.
And they're not very likely tostep in front of you and say,
hey, by the way, we're gonna getrid of this department and all
those costs are just gonna goback to you, right?
No, of course not.
They're not gonna say anythinglike that.
They're gonna say, hey, we didthis, we got rid of this, that
just means a smaller government,so hooray for us, right?
(08:37):
And they'll leave it at that.
And then when it comes back toyou, you're like, maybe we
shouldn't have done that, right?
But it's too late, it's alreadybeen done.
So we don't want to putourselves in that situation
unless we truly are acceptingthe facts and we understand the
full ramifications of what we'rereally asking for.
It could be a case of again, becareful what you asked for
(08:58):
because you just might get it.
And you don't want to end up onthe street yourself, you know,
because of some of the decisionsthat were made that you didn't
fully understand, and you wereessentially voting against your
own best interests.
And we've certainly seen thathappen many, many times,
especially fairly recently.
But again, another topic foranother day.
(09:19):
But not to be an alarmist, but Ithink that it's it behooves us
to really understand how thesethings work, and that can help
you make the best decisions foryourself, and then you can push
for those who represent you tomake the best decisions, not
only for you, of course, butyour community, your state, your
nation.
You know, you really want to beknowledgeable about how, again,
(09:42):
these things work and howthey're ultimately going to
affect you.
And the best that you can do isuse your critical thinking
skills and ask questions so thatyou're not blindsided and you
feel that you really have a fullgrasp of everything that's going
on.
Period.
And even if you don't understandeverything, then do a little bit
of homework, right?
Go to other people who seeminglyhave a better idea of what's
(10:05):
happening, maybe read somestuff.
You know, get as muchinformation as you can.
That's all I'm saying, right?
I'm just saying that the moreeducated we are, the more
knowledgeable we are, the betteroff we're gonna be.
And that's just you can just saythat for practically everything.
So that's really my spiel fortoday.
I don't want to go on and onabout it.
I think you got the whole pointhere.
(10:26):
But as we approach the end ofthe year, it is a good idea to
start thinking ahead about, youknow, your uh taxes that are
gonna be due, especially againif you're self-employed,
reducing your tax bill, youknow, contributing to your IRAs,
all those kind of things, doingsome tax harvesting.
Work with your investmentadvisor, work with your tax
advisor, etc., to be fullyprepared and put yourself in the
(10:50):
best situation.
So you pay what you owe, youdon't pay more than what you
should owe, right?
You don't want to do that.
It's not fair.
So one last thing I'm gonnaleave with is this is the finale
for season five, which is prettycool for me.
I'm glad about that.
We've got five years under thebelt.
But heading into season six,I've got a few things that are
(11:12):
on the horizon, a few thingsthat I think you'll find
helpful, useful, entertaining.
And some of them are already outthere.
And you can go to the websitewww.pinkmoney.com,
pinkmoneypodcast.com, pardon me.
I should know my own website.
Anyway, so go to the website,take a look at some of these
things.
I hope that you'll find againthem useful and entertaining.
(11:35):
But I think that's pretty muchfor me today.
And other than that, I hope youhave a great day and I will talk
to you next time.
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