Taxes

I've been learning a little about taxes, and I was told something from my professor that I didn't know before. I'm sure those who are experienced in paying taxes know this already, but for someone just starting out, this is interesting.

We have right now what is called a marginal tax system. That means that the amount you get taxed increases as your income increases. I knew this already, but what I didn't know is this: Lets say that if you make between $20,000 and 29,999 a year, you get taxed 10% (this is just arbitrary). And lets also say that if you make $30,000 to 39,999 a year you get taxed 20%. What I thought before was that if you were to make $30,000 a year, that ALL of your income (that is $30,000) is taxed at the higher (20%) rate, but that is not true. In our marginal system, what would happen is that the first $29,999 is taxed at 10% and only the last $1 is taxed at 20%. Did that make sense? Your money stays within its respective tax bracket. I was pretty happy to hear that! Not that I have to worry about that any time soon...