Spinning the income tax

[c1ue]

Or how to give libertarians an apoplectic fit :eek:

http://finance.yahoo.com/news/Nearly...67323.html?x=0

Tax Day is a dreaded deadline for millions, but for nearly half of U.S. households it's simply somebody else's problem.
About 47 percent will pay no federal income taxes at all for 2009. Either their incomes were too low, or they qualified for enough credits, deductions and exemptions to eliminate their liability. That's according to projections by the Tax Policy Center, a Washington research organization.

...

The result is a tax system that exempts almost half the country from paying for programs that benefit everyone, including national defense, public safety, infrastructure and education. It is a system in which the top 10 percent of earners -- households making an average of $366,400 in 2006 -- paid about 73 percent of the income taxes collected by the federal government.

The bottom 40 percent, on average, make a profit from the federal income tax, meaning they get more money in tax credits than they would otherwise owe in taxes. For those people, the government sends them a payment.

...

In 2007, about 38 percent of households paid no federal income tax, a figure that jumped to 49 percent in 2008, according to estimates by the Tax Policy Center.

...

But income tax rates were lowered at every income level. The changes made it relatively easy for families of four making $50,000 to eliminate their income tax liability.

Here's how they did it, according to Deloitte Tax:

The family was entitled to a standard deduction of $11,400 and four personal exemptions of $3,650 apiece, leaving a taxable income of $24,000. The federal income tax on $24,000 is $2,769.

With two children younger than 17, the family qualified for two $1,000 child tax credits. Its Making Work Pay credit was $800 because the parents were married filing jointly.

The $2,800 in credits exceeds the $2,769 in taxes, so the family makes a $31 profit from the federal income tax. That ought to take the sting out of April 15.

Of course, no mention made of the $3,825 dollars this family paid in FICA taxes.

Or the likely $2000 or so paid in sales taxes.

Or the $600 in gasoline taxes.

Or the $5000 to $10000 paid for health insurance.

[aaron]

Re: Spinning the income tax

Or how to give libertarians an apoplectic fit :eek:

http://finance.yahoo.com/news/Nearly...67323.html?x=0



Of course, no mention made of the $3,825 dollars this family paid in FICA taxes.

Or the likely $2000 or so paid in sales taxes.

Or the $600 in gasoline taxes.

Or the $5000 to $10000 paid for health insurance.

Or the economic rent paid to those at the top of the pyramid (who seem to pay a small percentage in taxes). Sure, they pay most of the total, but it is a small part of what they take in.

[Mn_Mark]

Re: Spinning the income tax

Of course, no mention made of the $3,825 dollars this family paid in FICA taxes.

Or the likely $2000 or so paid in sales taxes.

Or the $600 in gasoline taxes.

Or the $5000 to $10000 paid for health insurance.

But everyone has to pay those things. No one's saying that there are people paying NO tax. They're saying there are a lot of people paying no share of the costs of the FEDERAL programs, which are very substantial.

Their points are legitimate. Some people are expected to pay hundreds of thousands of dollars every year towards the costs of the Federal government, while a huge percentage of the population actually not only pay nothing towards those costs, they actually get paid some of other people's money.

It's collectivism. People who support it should have the intellectual honesty to just admit that it's Marxist instead of trying to change the subject by saying "but they pay some other taxes". If you support some Marxism, just admit it. Or else ask yourself why it bothers you so much to admit it.

[cindykimlisa]

Re: Spinning the income tax

But everyone has to pay those things. No one's saying that there are people paying NO tax. They're saying there are a lot of people paying no share of the costs of the FEDERAL programs, which are very substantial.

Their points are legitimate. Some people are expected to pay hundreds of thousands of dollars every year towards the costs of the Federal government, while a huge percentage of the population actually not only pay nothing towards those costs, they actually get paid some of other people's money.

It's collectivism. People who support it should have the intellectual honesty to just admit that it's Marxist instead of trying to change the subject by saying "but they pay some other taxes". If you support some Marxism, just admit it. Or else ask yourself why it bothers you so much to admit it.

Many people who get "paid" $366,000 or more are getting paid a lot of somebody elses money - ie the taxpayers and or shareholders - And some people who make $3,600,000 don't pay any taxes either so your comment is idealistic bs - it is not marxism. People who make $50,000 a year don't write off their taxes $100 lunches and vacations either. Many many people don't pay any taxes cause they don't report their income.

Cindy

[Raz]

Re: Spinning the income tax

Many people who get "paid" $366,000 or more are getting paid a lot of somebody elses money - ie the taxpayers and or shareholders - And some people who make $3,600,000 don't pay any taxes either so your comment is idealistic bs - it is not marxism. People who make $50,000 a year don't write off their taxes $100 lunches and vacations either. Many many people don't pay any taxes cause they don't report their income.

Cindy

Do you have any data to support your allegations? It doesn't match up with my experience.

How many people is "Many"? I know three people whose annual income is between $270,000 and $310,000 - they own small to medium sized businesses with between 15 and 65 employees, they still work 50+ hours every week, and their federal tax rate is about 38% of their GROSS income.
They're not getting one thin dime from the taxpayers and they certainly aren't taking money from the stockholders, unless taking dividends or S-Corp distributions on their own stock makes them cheats or freeloaders!

"Many people don't pay any taxes cause they don't report their income." Don't take this too hard, Cindy, but just what does that have to do with the price of eggs in China? It makes no difference what the tax rate is to evaders and criminals: they don't obey the laws no matter what rate is set.
It's like criminals and gun control: they don't obey any laws unless it pleases them to do so, and all that's accomplished by forcing stringent requirements on the mass of Americans is to disarm the law-abiding who are themselves the victims of crime.

Mark's comment is technically and idealogically correct, and your entire post reeks of B.S.

[c1ue]

Re: Spinning the income tax

But everyone has to pay those things. No one's saying that there are people paying NO tax. They're saying there are a lot of people paying no share of the costs of the FEDERAL programs, which are very substantial.

Their points are legitimate. Some people are expected to pay hundreds of thousands of dollars every year towards the costs of the Federal government, while a huge percentage of the population actually not only pay nothing towards those costs, they actually get paid some of other people's money.

It's collectivism. People who support it should have the intellectual honesty to just admit that it's Marxist instead of trying to change the subject by saying "but they pay some other taxes". If you support some Marxism, just admit it. Or else ask yourself why it bothers you so much to admit it.

Certainly true in one sense.

But in another sense, every person living in the US and thus using US dollars is subsidizing the US government and Fed as it prints dollars.

And in a literal sense, the Federal government isn't using taxpayer dollars to pay its bills - it is using its ability to print money.

Or does the ever increasing federal deficit mean nothing?

Lastly I note that merely pointing out that income tax is only one leg of the Federal government revenue tripod - the others being FICA taxes and deficit spending - is hardly Marxism.

Please restrain your Tea Party comments.

[orion]

Re: Spinning the income tax

Please restrain your Tea Party comments.

I don't see why you are out to slur libertarians and the Tea Party. Smaller government, reduced spending, and reducing massive entitlement programs sound very reasonable to me. You are falling into the same trap you just criticized him for.

[sunskyfan]

Re: Spinning the income tax

I agree, Raz, that someone running a business that creates something or provides a service is at least "fairly taxed". I am such a person and trust me I am taxed. I will defend Cindy in that it is pretty clear to me that two things are true. One, not everybody making money is actually contributing wealth and sometimes is actually taking it and, two, the ability to avoid taxes increases with money made. People who make money without creating anything are a bigger systemic threat to capitalism more than any tax. Now, I can understand how one would point the finger at government on that very score but government is not stealth about its taking and "we the people" have some kind of check on it in principle.

I think we need to get use to the idea that a substantial number of people making money are not creating anything and correcting that should be where our energy is spent.

[thriftyandboringinohio]

Re: Spinning the income tax

...a substantial number of people making money are not creating anything...

Sounds good in theory and appeals to our natural feeling that each of us is overworked and underpaid compared that lazy, rich S.O.B. over there. In reality, one might find a strong argument that a talented investor or a reviewing physician do good and earn their money.

[c1ue]

Re: Spinning the income tax

I don't see why you are out to slur libertarians and the Tea Party. Smaller government, reduced spending, and reducing massive entitlement programs sound very reasonable to me. You are falling into the same trap you just criticized him for.

The goals you've laid out are very reasonable, but these same goals are not what the Tea Parties are about.

Besides being funded by specific lobbying groups/sections of the Republican party (thus not a spontaneous popular uprising by any reasonable definition), the Tea Parties are not specifically seeking smaller government, reduced spending, or reducing massive deficits so much as protesting specific Obama legislation. This is not the same thing.

Note that I am not a fan of Obama's health reform bill either.

http://www.citizen-times.com/article/2010100402062

CHARLOTTE — While President Barack Obama touted green-energy jobs and the overhaul of America's health care system, tea party groups upset with his policies protested his visit Friday to a North Carolina factory that makes rechargeable batteries.

Protesters holding anti-Obama signs lined a busy street leading the Celgard LLC factory, which received a $49 million grant from the U.S. Energy Department last August. Among other things, the plant manufactures membranes used mainly in lithium batteries.

High Point businessman Larry Davidson said the health care reform package will ruin what he called "the best health care system in the world."

"It's the end of health care as we know it," said Davidson, 59. "He just rammed it down everyone's throat. It was wrong. He didn't listen to the people."

His friend, Dr. James McGukin, agreed.

"It's amazing what was done behind closed doors," said McGukin, 52, a cardiologist. "I'm telling you that many doctors are going to quit rather than deal with a socialist health care system. The changes are bad for doctors. Bad for the American people. This is socialism. Obama is not a leader, he's a dictator."

Obama toured the Celgard plant to promote green energy jobs. During his visit, he answered questions from factory workers, including one about the health care overhaul.

Outside, about 250 people held signs and shouting angrily at the president's motorcade as it passed to the factory. But there were some supporters.

"He doing a great job," said retired bus driver Bill Jackson, 56. "He's trying to do something. So many people don't have health care in this country. They're hurting. He had to do something."

But many in the crowd repeated the familiar chorus, comparing the health care overhaul to socialism. They held signs that read: "Repeal Obamacare" and "Obama, you are a socialist."

Craig Nannini, a leader of the Charlotte Tea Party, urged supporters to stay in control and stick to the issues. He didn't want a repeat of other rallies where some protesters made racial comments.

"It's about the message not the messenger," Nannini said. "He was fairly elected and we respect the office he holds. What we want to do is show we are opposed to his politics."

He noted that this was the first protest for many in the crowd.

"Look at this. They are worried about their futures. That's why they're here. We're not going away. We're here to stay and we're going to make sure they hear our voices at the polls."

[thriftyandboringinohio]

Re: Spinning the income tax

...said McGukin, 52, a cardiologist. "I'm telling you that many doctors are going to quit rather than deal with a socialist health care system. ...

In any business deal, it's always fair for either party to say "No thank you, no sale". I wish Dr. McGukin the best in learning a new trade at age 52. I suspect many competent young people will gladly step in to become cardiologists at these wages, which he finds so low he must quit.

U.S. Physician Salaries - Ongoing Salary Survey
*Survey includes base salaries, net income or hospital guarantees minus expenses
June, 2003 - Present
	SPECIALTY	Years 1-2	>3	Max
	Cardiology: Invasive	$258,000	$395,000	$647,000
	Cardiology: Interventional	$290,000	$468,000	$811,000
	Cardiology: Noninvasive	$268,000	$403,000	$599,000

[ViC78]

Re: Spinning the income tax

A better way to look at physician salaries would be to look at their compensation in terms of purchasing power parity. US is number 3 behind Netherland and Australia. Don't both of these countries have universal healthcare?



Another way is look at how a doctor’s salary compares to the average national income in that doctor’s country — that is, gross domestic product per capita. These numbers are in the third column, fifth and seventh columns of the chart.
As a country’s wealth rises, so should doctors’ pay. But even accounting for this trend, the United States pays doctors more than its wealth would predict:



But it’s important to keep in mind, the report notes, that health care professionals in other O.E.C.D. countries pay much less (if anything) for their medical educations than do their American counterparts. In other words, doctors and nurses in the rest of the industrialized world start their medical careers with much less student loan debt compared to medical graduates in the United States.
For more data on health spending in O.E.C.D. countries, go here. For a recent American-only survey on the pay of physicians with various specialties, go here.




http://economix.blogs.nytimes.com/20...ountries-make/

[Master Shake]

Re: Spinning the income tax

In any business deal, it's always fair for either party to say "No thank you, no sale". I wish Dr. McGukin the best in learning a new trade at age 52. I suspect many competent young people will gladly step in to become cardiologists at these wages, which he finds so low he must quit.

U.S. Physician Salaries - Ongoing Salary Survey
*Survey includes base salaries, net income or hospital guarantees minus expenses
June, 2003 - Present
	SPECIALTY	Years 1-2	>3	Max
	Cardiology: Invasive	$258,000	$395,000	$647,000
	Cardiology: Interventional	$290,000	$468,000	$811,000
	Cardiology: Noninvasive	$268,000	$403,000	$599,000

I think you'll find the barriers to entry are quite high.

[thriftyandboringinohio]

Re: Spinning the income tax

I think you'll find the barriers to entry are quite high.

As they should be -who wants a slacker cardiologist? Still, the medical schools will fill the seats, they always do.

[sunskyfan]

Re: Spinning the income tax

For every talented investor there are 20 charlatans: that is the problem. The issue is not the talented investor the issue is the charlatans. As long the charlatans can hide in the coat tails of the talented capitalism has a potentially fatal problem. That was the point I was trying to make.