A Bipartisan Plan for Tax Fairness by Sens. Ron Wyden and Judd Gregg

[GuitarDaddy]

i'm not going to worry much about single individuals with 125K/year incomes. crossover point looks like 120. get married and suddenly you're back to a tax cut.

With a 125k income even ATOTers should be able to find a woman

 

[her209]

"Tax fairness"

Oxymoron

 

[Deeko]

i'm not going to worry much about single individuals with 125K/year incomes. crossover point looks like 120. get married and suddenly you're back to a tax cut.

That's what I said, isn't it? That this will specifically hurt the "lower upper middle class"? Those people aren't poor, and aren't exactly hurting, but they are far from rich. Consider an unmarried person not too far out of college, living in or near a major metropolitan area that makes 125k. Between high cost of living and likely student loans, again...they aren't poor, but they're hardly those "dasterdly rich people" that need to be paying more taxes.

"Get married and suddenly you're back to a tax cut" - assuming what? That the spouse makes no income? If your spouse makes over 50k, it looks like it continues to be a tax increase. (and yes that was very rough math in my head to figure that out - the exact number might not be exactly 50k, but its close)

 

[ebaycj]

Making the first 35% of capital gains tax free is BS and is a non starter in my book, that immediately tilts the playing field and effectively lowers the rate to 22.75% for the highest earners that have their income structured as LT captial gains. If you eliminate that obvious loophole for the wealthy it looks like a reasonable comprimise overall. The key is how effectively they can limit or remove the loopholes for the top earners.

Here's what I'd do.

You get up to the first $1M (per year) in long term capital gains at the discounted rate. Above that, flat 35%.

 

[ebaycj]

for unmarried people with no kids and no house with solely wage income, it's $70K + the new standard deduction of $15K + their personal exemption of $3650 (looks like that number didn't change)

so we're really talking nearly 90K before 35% kicks in.

90k vs the current 373k right now. BS.

http://taxes.about.com/od/preparingyourtaxes/a/tax-rates_2.htm


Even tripling the standard deduction doesn't even come CLOSE to closing that spread.

 

[ebaycj]

True - US corps effectively pay a lot less than other countries.

I would be OK lowering the corp taxes to 24% provided 1) remove all exemptions except for the first 5 years of any business & 2) increase the capital gains tax to the same rate - except for retirees and exemption that to capped to, say $250K or so of income.

If they want it to pass, they'd go one further, and make it:

• A flat 6% tax on businesses less than 3 years old, with profits less than $2.5M / year.

• A flat 12% tax on businesses less than 6 years old, with profits less than $5M / year.

• After 6 years and/or a $5M profit year, the business graduates to the full 24%.

That would create jobs and promote small businesses.

Yes, that came out of a liberal's mind.

 

[Acanthus]

Id be all for it, as long as they added another tax bracket. 45% at 1m+.

Cut it when the treasury breaks even. If the rich don't like it they can lobby and even run personal ads for senators that will fight deficit spending.

 

[ebaycj]

I wonder how many US citizens even get to use the mortgage interest deduction? With the Standard Deduction being 11,400 this year, if I hadn't bought a new car in 2009, my mortgage interest, local property taxes, and state and local sales taxes wouldn't have been enough to take anything but the standard deduction. Looking at 2010, since I won't be buying a new car, I know I'll be taking the standard deduction.

I don't know about you, but my mortgage interest deduction + property tax deduction was worth about $5,000 to me. That's on a pretty average house ($200k).

 

[ebaycj]

those dividends were (theoretically) already taxed at the corporation level, of which he is an owner. double taxation is the rationale behind long term cap gains rates being lower than normal income. eliminate corporate taxation altogether and you eliminate that rationale.

Wait, I thought corporations were people now. You can't own people.

One way, or the other. Not both.

 

[ebaycj]

Here is my biggest complaint:

More and more companies and Corps want a discount or an exclusion on paying taxes. The reason this is bad is that if you own a house in an area where there is an exclusion then you the homeowner or property owner have to pay more tax to make up the difference. So what I think should happen is that on the federal and state tax if a company did not have to pay the tax they should have to include that same sum as income or payment-in-kind. It should have to be declared as income and taxed as such. In this way a company or Corps would not make any money by relocating to another location where they can get a tax free deal. This creates a more fair and equitable chance of getting companies to locate in your area. The goal should be to lower tax rates for all, not just the Corporate elite.

This.

 

[ebaycj]

Id be all for it, as long as they added another tax bracket. 45% at 1m+.

Cut it when the treasury breaks even. If the rich don't like it they can lobby and even run personal ads for senators that will fight deficit spending.

I like this too.

Structuring it as a 10% surtax would be better though. 10% surtax on $1M+ (on either capital gains or income) that pays directly to the principal balance of the national debt. Surtax declines to zero once national debt is < 5% the average GDP over the last 5 years.

Couple that with a balanced budget amendment, and we'd be good to go.