Re: Taxing the rich - what is the cutoff?
 

[quote=Sheriff Gonna Getcha;453215]Perhaps, but it's not like they are driving around in BMWs with gold-plated 22s and sippin' on $500 bottles of champagne. Households earning more than $250K live very comfortably in any market with any reasonable number of kids, but they are by no means "rich" (which is what this thread is about).

It strikes me as somewhat unfair to say to upper-middle class families, "You make more money than the rest of us, so hand over your money to the rest of us by allowing the government to tax you at a rate that is four times higher than mine." True, those upper-middle class systems benefitted from our current government and infrastructure. But let's not act like families earning $250K are just sitting on trust funds their parents set up; that is by far the exception to the rule. Most households earning $250K+ have breadwinners who have to bust their asses to make that kind of money and took enormous risks to get there (see, e.g., school debts incurred without any promise of a good ROI). Moreover, even under a flat tax system, their per capita tax burden is far and away more onerous than that which others have to carry.

Don't get me wrong, the lives of those earning $250K or more is not a sob story. But, these people are NOT rich IMO.[/quote]

Well frankly this thread is ridiculous because it began with an article about how these people would be nailed if they had to pay an additional 3% on the $50,000 they make over $250K (i.e. the extra $1,500 they wouldn't see each year and that would sink them apparently). I think the whole idea of a progressive tax structure has really flown over a lot of people's heads here. Those tax cuts were bad financial policy to begin with, but if we are so intent on keeping helping those who make significantly more than $250K then let's do some serious cost cutting. Stop paying for the Iraq War with supplementals that hide the true cost, have massive cuts to social programs, cut government spending across the board. I'm sure that will not increase economic inequality and a healthy society is all that important anyway. Get yours if you can get it, if you can't then clearly you were not cut out for the great race of life. Survival of the fittest as Herbert Spencer would say.

Re: Taxing the rich - what is the cutoff?
 

I'm not sure where anyone got the idea that $250k is "scraping by" - it clearly isn't.

It's equally as clearly not "rich" (or whatever the cash-flow equivalent is - I agree with Schneed on this one).

Re: Taxing the rich - what is the cutoff?
 

[quote=SC Skins Fan;453225]Well frankly this thread is ridiculous because it began with an article about how these people would be nailed if they had to pay an additional 3% on the $50,000 they make over $250K (i.e. the extra $1,500 they wouldn't see each year and that would sink them apparently). I think the whole idea of a progressive tax structure has really flown over a lot of people's heads here. Those tax cuts were bad financial policy to begin with, but if we are so intent on keeping helping those who make significantly more than $250K then let's do some serious cost cutting. Stop paying for the Iraq War with supplementals that hide the true cost, have massive cuts to social programs, cut government spending across the board. I'm sure that will not increase economic inequality and a healthy society is all that important anyway. Get yours if you can get it, if you can't then clearly you were not cut out for the great race of life. Survival of the fittest as Herbert Spencer would say.[/quote]
Sounds like a good plan to me. Can we also do away with SS? I also would like to see a source that this is a progressive tax the one someone did give was to a post in this thread.

Re: Taxing the rich - what is the cutoff?
 

[quote=firstdown;453223]So for a link I get someones post here on this thread? I was looking for a real source. I did not see any links on that page so I'm assuming it was a post you directed me too.[/quote]
I posted links in this thread in response to your initial post about people gaming the system by making $245k instead of $250k.
[QUOTE][B]United States[/B]

[I]See also: [URL="http://en.wikipedia.org/wiki/Income_tax_in_the_United_States"]Income tax in the United States[/URL] and [URL="http://en.wikipedia.org/wiki/Taxation_in_the_United_States"]Taxation in the United States[/URL][/I] The progressive aspects of the Federal income tax rates in the United States have varied widely since 1913. For example, in 1954 the Congress imposed a Federal income tax on individuals, with the tax imposed in layers of 24 income brackets at tax rates ranging from 20% to 91% (for a chart, see [URL="http://en.wikipedia.org/wiki/Internal_Revenue_Code_of_1954"]Internal Revenue Code of 1954[/URL]). [URL="http://en.wikipedia.org/wiki/As_of_2006"]As of 2006[/URL], there are six "tax brackets" ranging from 10% to 35% used to calculate the percentage of taxable income (of individuals) that must be paid to the [URL="http://en.wikipedia.org/wiki/United_States_Treasury"]United States Treasury[/URL]. If taxable income falls within a particular tax bracket, the individual pays the listed percentage of income [I]on each dollar that falls within that monetary range[/I]. For example, a person who earned $10,000 in [URL="http://en.wikipedia.org/wiki/Taxable_income"]taxable income[/URL] (income after adjustments, deductions, and exemptions) for 2006 would be liable for 10% of each dollar earned from the 1st dollar to the 7,550th dollar, and then for 15% of each dollar earned from the 7,551st dollar to the 10,000th dollar, for a total of $1,122.50. This ensures that every rise in a person's salary results in an increase of after-tax salary. The Treasury Department in 2006 reported, based on [URL="http://en.wikipedia.org/wiki/Internal_Revenue_Service"]Internal Revenue Service[/URL] (IRS) data, the share of all federal taxes paid by taxpayers of various income levels. The data shows the progressive structure of the U.S. federal tax system that reduces the [URL="http://en.wikipedia.org/wiki/Tax_incidence"]tax incidence[/URL] of people with smaller incomes, as they shift the incidence disproportionately to those with higher incomes - the top 0.1% of taxpayers by income pay 17.4% of all federal taxes (earning 9.1% of the income), the top 1% pay 36.9% (earning 19%), the top 5% pay 57.1% (earning 33.4%), and the bottom 50% pay 3.3% (earning 13.4%).[URL="http://en.wikipedia.org/wiki/Progressive_taxation#cite_note-22"][23][/URL]
However, if the federal taxation rate is compared with the [URL="http://en.wikipedia.org/wiki/Wealth_distribution"]wealth distribution[/URL] rate, which was studied in [I]A Rolling Tide: Changes in the Distribution of Wealth in the U.S.[/I] by Arthur Kennickell at [URL="http://en.wikipedia.org/wiki/Levy_Economics_Institute"]Levy Economics Institute[/URL], the net wealth (not only income but also including real estate, cars, house, stocks, etc) distribution of the United States does almost coincide with the share of income tax - the top 1% pay 36.9% of federal tax (wealth 32.7%), the top 5% pay 57.1% (wealth 57.2%), top 10% pay 68% (wealth 69.8%), and the bottom 50% pay 3.3% (wealth 2.8%).[URL="http://en.wikipedia.org/wiki/Progressive_taxation#cite_note-Kennickell-23"][24][/URL] Other taxes in the United States with a less progressive structure or a regressive structure, and legal [URL="http://en.wikipedia.org/wiki/Tax_avoidance"]tax avoidance[/URL] loopholes change the overall tax burden distribution. For example, the [URL="http://en.wikipedia.org/wiki/Payroll_tax"]payroll tax[/URL] system is regressive on income with no standard deduction or personal exemptions taxing only the first $97,500 for 2007 from gross wages, and none earned from capital investments or interest. The [URL="http://en.wikipedia.org/wiki/Center_on_Budget_and_Policy_Priorities"]Center on Budget and Policy Priorities[/URL] states that [I]three-fourths[/I] of U.S. taxpayers pay more in payroll taxes than they do in income taxes.[URL="http://en.wikipedia.org/wiki/Progressive_taxation#cite_note-newlight-24"][25][/URL][/QUOTE][URL="http://en.wikipedia.org/wiki/Progressive_taxation#cite_note-newlight-24"][/URL]

Re: Taxing the rich - what is the cutoff?
 

[quote=firstdown;453227]Sounds like a good plan to me. Can we also do away with SS.[/quote]

Yes, government gone. Except for the military and police to protect the God given right of personal property and the rights of Due Process for corporations secured under the 14th amendment. Wouldn't want any revolutionaries thinking they could affect social change by force.

Re: Taxing the rich - what is the cutoff?
 

[QUOTE=SC Skins Fan;453225]Well frankly this thread is ridiculous because it began with an article about how these people would be nailed if they had to pay an additional 3% on the $50,000 they make over $250K (i.e. the extra $1,500 they wouldn't see each year and that would sink them apparently). I think the whole idea of a progressive tax structure has really flown over a lot of people's heads here. Those tax cuts were bad financial policy to begin with, but if we are so intent on keeping helping those who make significantly more than $250K then let's do some serious cost cutting. Stop paying for the Iraq War with supplementals that hide the true cost, have massive cuts to social programs, cut government spending across the board. I'm sure that will not increase economic inequality and a healthy society is all that important anyway. Get yours if you can get it, if you can't then clearly you were not cut out for the great race of life. Survival of the fittest as Herbert Spencer would say.[/QUOTE]

I have to wonder whether this whole debate is about what is fiscally wise or what "feels right." The former issue is up for debate as I highly doubt that anyone here is qualified to say with a very high degree of certainty that any tax scheme is what is best for our country. The latter issue is I think what is dominanting the conversation. I never would have thought that a discussion about tax schemes could become so heated.

Re: Taxing the rich - what is the cutoff?
 

You're probably right. It may be time to shut it down. I've enjoyed it though - it's been an education on several issues.

Re: Taxing the rich - what is the cutoff?
 

[quote=onlydarksets;453228]I posted links in this thread in response to your initial post about people gaming the system by making $245k instead of $250k.
[/quote]
My point wasn't about people breaking the law but when a person is self employed they can spend the money on the business keeping their salary under the $250 mark.

Re: Taxing the rich - what is the cutoff?
 

[quote=firstdown;453234]My point wasn't about people breaking the law but when a person is self employed they can spend the money on the business keeping their salary under the $250 mark.[/quote]
"Gaming" doesn't mean illegal - it means "using the rules, policies and procedures of a system against itself for purposes outside what these rules were intended for." The Wikipedia article I posted just describes how the US has a progressive tax.

Re: Taxing the rich - what is the cutoff?
 

[quote=Sheriff Gonna Getcha;453215]Perhaps, but it's not like they are driving around in BMWs with gold-plated 22s and sippin' on $500 bottles of champagne. Households earning more than $250K live [U]very[/U] comfortably in any market with any reasonable number of kids, but they are by no means "rich" (which is what this thread is about).

It strikes me as somewhat unfair to say to upper-middle class families, "You make more money than the rest of us, so hand over your money to the rest of us by allowing the government to tax you at a rate that is four times higher than mine." True, those upper-middle class families benefitted from our current government and infrastructure. But let's not act like families earning $250K are just sitting on trust funds their parents set up or merely have to breathe in order to make the cash; that is by far the exception to the rule. Most households earning $250K+ have breadwinners who have to bust their asses to make that kind of money and took enormous risks to get there (see, e.g., school debts incurred without any promise of a good ROI). Many people earning $40-$50K per year work 9-5 jobs. Most people earning $250K work 11 hour days, don't leave work at the workplace, etc. Moreover, even under a flat tax system, their per capita tax burden is far and away more onerous than that which others have to carry.

Don't get me wrong, the lives of those earning $250K or more is not a sob story. But, these people are NOT rich IMO.[/quote]

You're preaching to the choir in regards to people making 250K not being rich, these people have to work day in day out after all. I do however find it odd some feel that 250K is not enough.

Re: Taxing the rich - what is the cutoff?
 

[quote=saden1;453238]You're preaching to the choir in regards to people making 250K not being rich, these people have to work day in day out after all. I do however find it odd some feel that 250K is not enough.[/quote]
I agree the debate over if 250k is enough to live on has really moved this thread in a different direction. As I said earlier its more about "Is It Fair" to push more tax burden onto them?

Re: Taxing the rich - what is the cutoff?
 

I think it's interesting that "$250k is comfortable, not rich" has been mischaracterized as an argument for $250k not being enough to live on.

Anyway, I agree it's time to move on. Where's SS with one of his "Understanding the issues" threads?

Re: Taxing the rich - what is the cutoff?
 

[quote=onlydarksets;453246]I think it's interesting that "$250k is comfortable, not rich" has been mischaracterized as an argument for $250k not being enough to live on.

Anyway, I agree it's time to move on. Where's SS with one of his "Understanding the issues" threads?[/quote]

Yeah it's important not to get it misconstrued.

I think the budgeting exercise we went through, in consideration with your input on childcare and student loans, shows that $250K is a good cutoff for a 3% increase in the tax rate.

Those making $250K, even in a worst case where student loans and daycare were through the roof, would pay 0 in new taxes. Those making $300K would pay an additional $1500 per year, and it's been shown here that if you make $300K, you can afford a very nice lifestyle and big daycare costs and massive student loans.

But no, $250K per year is not "rich."

Re: Taxing the rich - what is the cutoff?
 

While I make pretty good money I'd feel just fine making 250k. All I need to do is fire all employee's, do away with all other overhead and cost and I could be there.

Re: Taxing the rich - what is the cutoff?
 

[quote=firstdown;453243]I agree the debate over if 250k is enough to live on has really moved this thread in a different direction. As I said earlier its more about "Is It Fair" to push more tax burden onto them?[/quote]

As a single guy that makes roughly half of that I think it's fair. Would I like to get more of my money back? Sure would. Do I feel burdened by taxes? No. Why is roughly half of my property taxes going towords local school districts when I don't have any kids? I don't know, but I do know that I went to public schools and it's the right thing to do....etc...etc...etc.

We've beat this subject to death. Time to explore a new subject. Take it aways SmootSmack.

Re: Taxing the rich - what is the cutoff?
 

[quote=Schneed10;453249]Yeah it's important not to get it misconstrued.

I think the budgeting exercise we went through, in consideration with your input on childcare and student loans, shows that $250K is a good cutoff for a 3% increase in the tax rate.

Those making $250K, even in a worst case where student loans and daycare were through the roof, would pay 0 in new taxes. Those making $300K would pay an additional $1500 per year, and it's been shown here that if you make $300K, you can afford a very nice lifestyle and big daycare costs and massive student loans.

But no, $250K per year is not "rich."[/quote]
Or maybe people could do with less have one parent at home and do away with daycare cost. I guess thats a whole nother thread for another day when things are slow.

Re: Taxing the rich - what is the cutoff?
 

I agree with Schneed and saden1. firstdown - that's definitely a new thread. I nominate you to start that one ;)

Re: Taxing the rich - what is the cutoff?
 

[quote=onlydarksets;453253]I agree with Schneed and saden1. firstdown - that's definitely a new thread. I nominate you to start that one ;)[/quote]

Maybe the Redskins will do something worth talking about ... imagine that! Six weeks to the HOF game ...

Re: Taxing the rich - what is the cutoff?
 

[quote=saden1;453251]As a single guy that makes roughly half of that I think it's fair. Would I like to get more of my money back? Sure would. Do I feel burdened by taxes? No. Why is roughly half of my property taxes going towords local school districts when I don't have any kids? I don't know, but I do know that I went to public schools and it's the right thing to do....etc...etc...etc.

We've beat this subject to death. Time to explore a new subject. Take it aways SmootSmack.[/quote]
Not to keep this going but where you say you do not feel burdened by the taxes you pay I do with a family of four. I'm self employed so each month I have to wright a big check to the Fed. and one to the state. Then at the end of the year they say my business grew but I did not take home any more pay and have to pay taxes on this so called growth. I think eveyone should have to pay their own taxes as it would cause allot more people to start thinking about whats happening to all their money. Heck, ask a person what they pay in fed and state taxes and most have no clue at all just what they bring home.

Re: Taxing the rich - what is the cutoff?
 

[quote=SC Skins Fan;453255]Six weeks to the HOF game ...[/quote]Wow. When did that happen?!

I was still thinking it was baseball season.

Re: Taxing the rich - what is the cutoff?
 

[QUOTE=firstdown;453227]Sounds like a good plan to me. Can we also do away with SS?[/QUOTE]

That hurts man, that really hurts. What did I ever do to you?

Working on a new Understanding the Issues thread. The next one was going to be about the economy but I think this one pretty well covers it.

Hats off to those of you (you know who you are) who provided extremely insightful information.

Anyhow, I need to give some thought as to what the next topic should be. They start to get especially sensitive now so I must exercise caution.

I'll have something in the next 48 hours though. In the meantime, carry on with this discussion.

Re: Taxing the rich - what is the cutoff?
 

[quote=firstdown;453261]Not to keep this going but where you say you do not feel burdened by the taxes you pay I do with a family of four. I'm self employed so each month I have to wright a big check to the Fed. and one to the state. Then at the end of the year they say my business grew but I did not take home any more pay and have to pay taxes on this so called growth. I think eveyone should have to pay their own taxes as it would cause allot more people to start thinking about whats happening to all their money. Heck, ask a person what they pay in fed and state taxes and most have no clue at all just what they bring home.[/quote]

I don't understand...if you're not growing you shouldn't be paying taxes on anything beyond your taxable revenue. If inflation and rising costs is taking it's toll on you then I feel you but understand that you're not the only one hurting in that regard.

As for small business operation, why are you filing your taxes every? Unless your revenue is extensive shouldn't you be filing quarterly or annually? Anywho, my parents own a small business. They have 10 or so employees and they let ADP handle their payroll taxes and a CPA do their taxes quarterly. I've heard them complaining about business being slow these days because people are cutting back on their spending and that's about it. I'm sure they wouldn't mind paying less taxes but they're not hurting because of taxes. I'm sure your situation is different but I don't know by how much.

Re: Taxing the rich - what is the cutoff?
 

[quote=saden1;453290]I don't understand...if you're not growing you shouldn't be paying taxes on anything beyond your taxable revenue. If inflation and rising costs is taking it's toll on you then I feel you but understand that you're not the only one hurting in that regard.

As for small business operation, why are you filing your taxes every? Unless your revenue is extensive shouldn't you be filing quarterly or annually? Anywho, my parents own a small business. They have 10 or so employees and they let ADP handle their payroll taxes and a CPA do their taxes quarterly. I've heard them complaining about business being slow these days because people are cutting back on their spending and that's about it. I'm sure they wouldn't mind paying less taxes but they're not hurting because of taxes. I'm sure your situation is different but I don't know by how much.[/quote]
I have a S corp. so if on paper my business grows but I do not pay myself anymore money at the end of the year even though I did not take the money out of the business I have to pay taxes on that money. I've been hit a couple of times but back a few years we increased my pay and my 2 employees so this did not happen again. Its like I have to run the corp. so at the end of the year its in the negative and not the positive. My CPA does my payroll and my quarterly taxes. I've always paid my state and federal payroll taxes monthly then at the end of the quarter they just subtract out what I have allready paid and I send in the difference. I think every business has to send in their estimated payroll taxes each month because if mine is late any month they fine me. I'd hate to wait and pay it all every quarter because it would seem even that much worse.

Re: Taxing the rich - what is the cutoff?
 

This is somewhat of an off-topic bump, but I thought I'd dispell the notion that the Bush tax cuts are regressive.

Here's an excerpt from a politico [URL="http://www.politico.com/news/stories/0608/11259.html"]op-ed[/URL].

[I]But what about the Bush tax cuts? They only favor the wealthy, right? Again, let’s go to the facts. Since 2000, when President Bush entered office, the share of federal tax liabilities borne by the lowest and middle quintiles has decreased, while the share borne by the highest quintile has increased. In 2000, the lowest quintile bore 1.1 percent of total federal tax liabilities compared with 0.9 percent in 2004, the year that all of the Bush tax cuts were in effect. Thus, the federal tax liability of the lowest quintile dropped 18 percent. However, the highest quintile paid 67.2 percent of these liabilities in 2004, an increase of 1 percent in their liability since 2000, when they paid 66.6 percent. Far from favoring the wealthy, these numbers suggest that the wealthy are bearing more of the tax burden

The Department of the Treasury recently released a paper studying the impact of letting tax relief expire: “A four-person, one-earner family with wage income each year of $40,000 in 2007 dollars would see a tax increase of $2,345; a four-person, one-earner family with wage income each year of $80,000 in 2007 dollars would see a tax increase of $2,000; a three-person, one-earner family with wage income each year of $40,000 in 2007 dollars would see a tax increase of $1,655; and a head of household with two children and wage income each year of $30,000 in 2007 dollars would see a tax increase of $1,615.”

More than 116 million Americans would see their taxes go up. And small businesses that pay their taxes based on individual rates (which is most of them) could see their effective rate rise to more than 44 percent. [/I]

Re: Taxing the rich - what is the cutoff?
 

Well stated. You are not alone in your views. The salary I earn for my family does not belong to the Government. If the Government wants to stick their hands deeper into my bank account and call it change, then I'm not on-board. While I'm definitely not in the 'rich' tax bracket, I object to tax burden that the folks in this tax bracket endure.

[quote=Slingin Sammy 33;452784]I'm pretty sure the folks making this type of income will survive. Contrary to popular belief, most families making that type of money did not get it handed to them through trust funds or Mommy & Daddy paying all their bills until they were in their 30s. I would argue that their good judgement in putting 15% in their 401K and sending their children to private schools is also, in the long run, much better for the economy.

A majority of them worked their hind-quarters off to try to make a better life than what they came up in, even if it meant making sacrifices like studying in high school so they could get into a good college while their friends were at parties and getting drunk/high, studying and working internships while in college rather than blowing off class and partying, or spending years in the military to attend or pay for college at night, working 50-60 hour weeks, spending time on the road away from their families, answering pages, texts and cell phones in the middle of the night to deal with business responsibilities.

I've posted the numbers before, the top 10% of earners pay approximately 67% of the taxes in this country, the bottom 50% pay about 3%. The rates for income earned vs. tax rate is disproportionate.

WTF right does the government have to increase the tax rates on the "wealthy". It's flat out wealth confiscation and redistribution. The money earned by the American people is THEIRS it is NOT THE GOVERNMENT'S. Unfortunately, so many people have the attitude of "well they can afford it".....until they move into a higher tax bracket and their tax rate goes up. It doesn't matter if the "wealthy" can afford it, why should they? The "raise taxes on the rich" argument is class warfare at its worst. How does the "top 2%" fight this? They can't because the folks voting in November outnumber them by a vast majority and don't recognize or don't care that what is being proposed is wrong.

Not only is this approach flat out wrong, it will stiffle the economy. It has been proven time and again, when the government raises taxes the economy slows down. Like it or not, that "top 2%" is not just ambulance- chasing lawyers, professional athletes, and overpaid CEOs of major corporations. It is mostly your local doctor, dentist, salesperson, or small business person who owns the local restaurant or store at the mall. Most of these folks go to the same stores, drive on the same roads, go to the same churches and work their asses off like everyone else. And they almost never qualify for or take advantage of any government entitlement programs.

And I don't want to hear the "Warren Buffett paid 15% or 17%" argument. Buffett is in the crowd that can live off investments and has a team of accoutants/tax attorneys making sure he pays the least amount of taxes he can. Most of the people in the $ 250-300K range make a vast majority of their income through salaries and business income that isn't taxed at the lower capital gains rate.[/quote]

Re: Taxing the rich - what is the cutoff?
 

[quote=Sheriff Gonna Getcha;453906]This is somewhat of an off-topic bump, but I thought I'd dispell the notion that the Bush tax cuts are regressive.

Here's an excerpt from a politico [URL="http://www.politico.com/news/stories/0608/11259.html"]op-ed[/URL].

[I]But what about the Bush tax cuts? They only favor the wealthy, right? Again, let’s go to the facts. Since 2000, when President Bush entered office, the share of federal tax liabilities borne by the lowest and middle quintiles has decreased, while the share borne by the highest quintile has increased. In 2000, the lowest quintile bore 1.1 percent of total federal tax liabilities compared with 0.9 percent in 2004, the year that all of the Bush tax cuts were in effect. Thus, the federal tax liability of the lowest quintile dropped 18 percent. However, the highest quintile paid 67.2 percent of these liabilities in 2004, an increase of 1 percent in their liability since 2000, when they paid 66.6 percent. Far from favoring the wealthy, these numbers suggest that the wealthy are bearing more of the tax burden [/I]

[I]The Department of the Treasury recently released a paper studying the impact of letting tax relief expire: “A four-person, one-earner family with wage income each year of $40,000 in 2007 dollars would see a tax increase of $2,345; a four-person, one-earner family with wage income each year of $80,000 in 2007 dollars would see a tax increase of $2,000; a three-person, one-earner family with wage income each year of $40,000 in 2007 dollars would see a tax increase of $1,655; and a head of household with two children and wage income each year of $30,000 in 2007 dollars would see a tax increase of $1,615.” [/I]

[I]More than 116 million Americans would see their taxes go up. And small businesses that pay their taxes based on individual rates (which is most of them) could see their effective rate rise to more than 44 percent. [/I][/quote]

So when Obama talks about repealing the Bush tax cuts, he's actually proposing to make the tax system less progressive.