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How much I pay in taxes on a $163,800 per month income

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Graham Stephan pulled back the curtain on what a $163,800 month actually looks like once the IRS and California take their cut.

The Los Angeles real estate agent and personal finance YouTuber, whose channel had just crossed 1 million subscribers, published a line-by-line breakdown of his monthly income and the tax bill that comes with it. Stephan’s gross monthly haul — stacked from YouTube AdSense, his online real estate courses, commissions through The Oppenheim Group, affiliate deals, and cash flow off six rental properties — hit $163,800. What he actually keeps after federal brackets and California’s top-tier state income tax is a much smaller number, and he walked viewers through exactly why.

• Stephan’s combined monthly income across YouTube, course sales, Oppenheim Group commissions, affiliate revenue, and six rental properties peaked at $163,800.
• He detailed an effective tax rate between roughly 40% and nearly 50% on ordinary business income once federal brackets and California state tax stack together.
• He routinely sets aside 40% to 50% of every check into a high-yield business savings account to cover quarterly estimated tax payments.

Breaking Down the $163,800

Stephan’s monthly total wasn’t a single paycheck — it was five separate income streams layered on top of each other. YouTube AdSense alone was on pace to clear $1 million a year given the channel’s growth past 1 million subscribers. Add in his online real estate education courses, real estate commissions earned through The Oppenheim Group, affiliate marketing partnerships, and net cash flow from six rental units, and the sum landed at $163,800 in a peak month.

That kind of diversified income is exactly what he’s coached his audience toward in past videos, including his breakdown of what a single 1-million-view video actually pays, and it mirrors the multi-stream approach he’s described building since his channel was a fraction of its current size.

Effective Tax Rates Approach Fifty Percent

Stephan walked through how progressive federal brackets stack on top of California’s state income tax, which carries the highest top marginal rate in the country. Combined, he said, ordinary business income at his level gets taxed at an effective rate that climbs from around 40% toward nearly 50% before self-employment tax is even factored in separately.

High gross income looks very different after state and federal liabilities are paid.

That gap between what shows up on a bank statement and what actually gets deposited is the entire point of the video — Stephan built the breakdown specifically to counter the assumption that a six-figure monthly income means six figures in the pocket.

The S-Corp Strategy

To soften that bite, Stephan runs his business income through an S-Corporation structure. He pays himself a “reasonable” W-2 salary and passes the remaining net earnings through as distributions, which sidesteps a chunk of self-employment tax that would otherwise apply to every dollar. It’s the same structural question he’s tackled in more general form in pieces like his comparisons of LLC versus sole proprietor setups and guidance on converting a sole proprietorship into an LLC, though the S-Corp election adds another layer once income reaches Stephan’s territory.

On top of the entity structure, he leans on standard write-offs: home office deductions, studio recording equipment, software subscriptions, travel, and vehicle mileage tied to business use. His six rental properties add another lever — depreciation schedules that offset the rental income itself, a tool available to any landlord but especially valuable once cash flow starts stacking up the way his has.

Cash-Flow Discipline Behind the Numbers

None of the tax strategy works without the habit Stephan says he built early: setting aside 40% to 50% of every incoming check into a high-yield business savings account the moment it lands, specifically to cover quarterly estimated tax payments. That discipline is the same instinct he’s shown since his channel was covering far smaller numbers — including in his video on what a 9,000-subscriber channel actually earned, where the transparency-first format he’s known for started.

Stephan has built his public persona partly on that contrast — seven-figure income paired with famously frugal habits, like brewing 20-cent coffee at home instead of buying it out. The tax video leans on that same tension: big numbers on the gross side, deliberately modest habits on the spending side, and a tax bill in the middle that eats far more than most viewers expect.

Stephan’s channel had just crossed a million subscribers when this video went up, and the growth curve he described — AdSense alone on track past $1 million a year — means next year’s version of this breakdown will have an even bigger number at the top and, thanks to the S-Corp structure he laid out, presumably a similar percentage carved off for the IRS and Sacramento.