> I had a US business professor explain in one of my business classes that making a bit more money might push you over into the next tax bracket and cost you more in taxes than you made.

He's not wrong. You are correct if you consider only income taxes. But there are other tax benefits that lead to discontinuities with respect to income.

As an example, in my state you can deduct up to $5000 of contributions to a 529 plan if your income is under $250K. Go a penny above that threshold, and you can deduct only $2500. That extra penny just reduced your refund by a few hundred dollars.

But he's not really wrong, either.

In the Netherlands we have a marginal tax rate, so every Euro over X gets taxed 10%, everything over Y gets taxed 15% etc. (simplified numbers obviously).

However, often times it's better to stay in the top of a lower bracket because of tangentially-related benefits, such as healthcare subsidies, rent subsidies and other things like that. If you go from tax bracket 1 -> 2 because you get a 100 euro raise, sure you'll get 100 euros more (well, more like 95 but whatever), but you also lose out on more than that in the form of a loss in other benefits.

My partner went through this recently, she got a raise at work, but as a result she actually lost the subsidized rent money she got from the gov't. She had to request her workplace lower her wage so she was under the limit, because otherwise she couldn't have afforded rent on her own, and if the raise was even 2 euros/hr higher, she might've even been kicked out of her social housing situation.

That's because the benefits aren't marginal, they work on a hard cut-off limit. Anything over X amount and you're just cut off, you're not gradually weened off it until you're at a high enough income to not require gov't help.