Rangel's Tax Increase Proposal

[imported_Lothar]

Originally posted by: marincounty

Originally posted by: piasabird
I think we should just abolish SS. The money is not being spent on what it is being taxed for so lets just abolish it altogether. I think the supreme court to rule it is unconstitutional and force the government to give it all back and stop all social security payments immediately.

I guess grandma and grandpa will just have to move in with you since they won't have much income. Social Security is one of the best gov programs. Your ideal society is Dickensian England. People work 7 days per week and govt provides nothing.

And just to make a point, I don't have a problem with grandma and grandpa living with me.
It's part of my culture in fact...They already DO!

Not everyone shares your "dump grandparents in a nursing home//leave them alone in their rocking chairs at their own home somewhere 300miles away in another state" sentiment.

Do you really believe that the gov't provides benefits free of charge? Do you actually believe in free lunches?

I so wish I can decline SS right now.
I can easily invest that SS money in the stock market with at least a 10% yearly average return just by being in the S&P 500 Index.

What is the government's return rate on SS?
If one was to pay $100 in SS tax and retire when you turn 65, how much will you get back?
Can someone get me a percentage quote on that so we can compare to investing in the stock/bond markets and also opening an ING savings account?

 

[heyheybooboo]

Originally posted by: Lothar

What is the government's return rate on SS?
If one was to pay $100 in SS tax and retire when you turn 65, how much will you get back?
Can someone get me a percentage quote on that so we can compare to investing in the stock/bond markets and also opening an ING savings account?

I'm dancing on this one but the last time I found some info it took 10-11 years to get your money back if you were an 'average' taxpayer - whatever that meant. Much less if you were poor - much longer if you're 'rich'.

10-15 years ago it was like 7 years to get your money back.

20-25 years ago it was much lower - something like 3-4 years.

 

[Fern]

Originally posted by: heyheybooboo

Originally posted by: Fern

Originally posted by: heyheybooboo
I'll throw some numbers out . . .

In 2004 - 132,226,042 tax returns

129,204,606 tax returns were less than $200k.

119,469,037 tax returns were less than $100k.


4% surtax on incomes above $150,000 for a single earner or incomes above $200,000 for a married couple

Looks like 1% or less of Americans * $200,000 for a married couple* - not that I'm engaging in class warfare. I did have to pay $128 in AMT tax a few years ago and I make well less than $100k/year. Anything that starts to address AMT is a good thing.

Tax numbers from Individual Income Tax, All Returns: Sources of Income and Adjustments (XLS) from our good friend, Uncle IRS.

Here again, chart is not completely helpful, and/or your intepretation is faulty.
~~snip~~
Fern

Fern sez: Firstly, it's ALL taxpayers, meaning corporations, p'ships, etstates, trusts etc.

Read the title of the link, please, Fern .Individual Income Tax, All Returns It's individual Form 1040 income tax returns and associated schedules.

Yeah, YOUR title says that. But the IRS spreadsheet you linked is titled "ALL TAXPAYERS". Moreover, if you scroll over to right on the spreadsheet (Column CN etc) you'll see that Businesses and estates & trusts tax returns etc are included in the total. You've not klinked just 1040's, but ALL tax returns

Fern sez: Secondly, and can't be sure due to lack explanitory language, the chart shows about 11 million taxpayers with salary & wage income above $100K. That's compared to about 112 million tax returns showing salary/wage income. Thus about 10% of people (filing retruns with wages) make $100K or above.

And what does that have to do with my point that Looks like 1% or less of Americans * $200,000 for a married couple* would be subject to the 4% as depicted in Pabs misleading title to this thread ??? If you would have read Pabs link that would make sense to you as would my next 'factoid' - that 673,273 returns would be subject to 4.6% (those returns over $500k a year). Maybe one half of one percent of taxpayers? You make the call, Fern . . . .

Firstly, each individual person is taxpayer. A married couple filing a joint is still 2 taxpayers (not 1). With over 10% of the population amking +$100K no way less than 1% of households have $200K. Focus on the wage column of the charts. Much more than 1% of individual have wages of $200K. Then there are those who's income is from businesses and investments etc.

Fern sez: There are more not counted in the above number: ~~ Those with business income (income coming through tax returns via K-1's, whether doctors, lawyers, accountants or biz other owners) not reported on a W-2. ~~ Those with sufficient non-wage income to push them above $100K (dividengds, cap gains, interest etc) when combined with their W-2 wage income..

Those who are the non-working rich. No wages, just a bunch of other income.

Ferrrrrrrn. Read the title of the link, please. Individual Income Tax, All Returns It's individual Form 1040 income tax returns. There are over 130 columns in the spreadsheet that include schedules and line items associated with ALL individual tax returns. And are you saying ""non-working rich. No wages, just a bunch of other income"" don't file 1040s???

See above. ( The only reference I see to Form 1040 are in your post)

As an example, column BJ (I know you guys like to talk about that!) in the spreadsheet is "Net Long-term partnership/S-corp loss". I only wish there was a column FU for yah, Fern :shocked:

It's funny you claim my intepretation is faulty. Is that page one in the Karl Rove Contard Attacking Point Handbook? Deny factual information!

See bolded/italicized remarks above,

Edit: I dunno. I don't see C Corp tax returns in there. And I don't feel like footing the sreadsheet to figure it out. So "whatever" as far as that link goes I don't see any label other than "All Returns".

Edit #2: I'm starting to think you're right about it being just 1040's. Found the 2005 data +2% are $200K and above for gross income (but not taxable).

Fern

 

[Excelsior]

Originally posted by: Skoorb
Forget it. It won't ever happen. No country has done it or will do it or can do it. You might as well argue that Uncle Sam should give us all chauffeured helicopters (and yes, even the chauffeurs will get one).

No country? What about these?

 

[theeedude]

The 2.4 Trillion for Iraq and Afghanistan should be paid for by us with our taxes now, not passed on to future generations.

 

[heyheybooboo]

Originally posted by: Fern

See bolded/italicized remarks above,

Edit: I dunno. I don't see C Corp tax returns in there. And I don't feel like footing the sreadsheet to figure it out. So "whatever" as far as that link goes I don't see any label other than "All Returns".

Edit #2: I'm starting to think you're right about it being just 1040's. Found the 2005 data +2% are $200K and above for gross income (but not taxable).

Fern

It's quite good info once you get into it. I'm open to nearly anything as long as it is a reasonable discussion without posturing, pandering manipulative rhetoric. Rangel's plan has good points and not-so-good points and at least it's on the table.

He cuts the coprate rate - now if they could take a wack at 'corporate welfare' that would be a good thing. He takes a big wack at those who profit from the foreign tax credit fiasco - I think that's a good thing, too. The idea that a company could move overseas, garner huge profits, and bring those profits tax free back into the US should really piss everyone off.

4% vs 3%? 4.6% vs 3.5%? It's all semantics to me. Functionally, the Fed bugdet needs to be repaired. Hands off SS - reinvest the trust funds back in American infrastructure with low-interest loans to state and locals. Pay and protect the GD soldiers - not the military industrial complex. Raise the SS age 2-3 years. Index the SS cap to inflation. STOP the Pension Benefit Guaranty Corporation (PBGC) in its tracks - NOW.

Earmarks - Gone!
LNCB - Give me a break!
Medicare Advantage - Eliminated!
Prescription Drug Program - Good gosh almighty. $300-400 billion could be wacked over the next 10 years.

Iraq? - OUT!

And we need a constitutional amendment whereby any Federal elected official can be recalled by the American people Let's see what Washington thinks about that!

 

[shira]

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

You're doing more than just misreading:

First, the surcharge applies only to amount of taxable income in excess of 200K (for married couples). Thus, a couple would need to have a taxable income of $201,000 to pay a $40 surtax (4% of the $1,000 taxable income in excess of $200,000).

Furthermore, for a couple to have $201k of taxable income, the couple's total income would typically need to be at least $275k (before deductions for home mortgage interest, state income tax, property tax, 401k payments, child-care and medical reimbursement accounts, and charity).

As to what's "middle class," in 2005 See chart the U.S. Census Bureau published a report that stated in part that only 2.67% of all U.S. households have total (pre-deduction) incomes of greater at least $200,000. Only 1.5% have incomes in excess of $250,000. Thus, if the assumption is that total (pre-deduction) household income needs to beat least $275,000 before the surtax kicks in, it's fairly safe to estimate that that only about 1.3% of households are going to be affected by this surtax.

If you want to call the 98.7th percentile of household income "middle class," go right ahead. But I think $275,000 yearly income is at the very least bordering on upper class. And for this surtax to take a noticeable bite (say $10,000 extra), a household income of in excess of $500,000 would be required - hardly "middle class."

 

[Engineer]

Originally posted by: shira

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

You're doing more than just misreading:

First, the surcharge applies only to amount of taxable income in excess of 200K (for married couples). Thus, a couple would need to have a taxable income of $201,000 to pay a $40 surtax (4% of the $1,000 taxable income in excess of $200,000).

Furthermore, for a couple to have $201k of taxable income, the couple's total income would typically need to be at least $275k (before deductions for home mortgage interest, state income tax, property tax, 401k payments, child-care and medical reimbursement accounts, and charity).

As to what's "middle class," in 2005 See chart the U.S. Census Bureau published a report that stated in part that only 2.67% of all U.S. households have total (pre-deduction) incomes of greater at least $200,000. Only 1.5% have incomes in excess of $250,000. Thus, if the assumption is that total (pre-deduction) household income needs to beat least $275,000 before the surtax kicks in, it's fairly safe to estimate that that only about 1.3% of households are going to be affected by this surtax.

If you want to call the 98.7th percentile of household income "middle class," go right ahead. But I think $275,000 yearly income is at the very least bordering on upper class. And for this surtax to take a noticeable bite (say $10,000 extra), a household income of in excess of $500,000 would be required - hardly "middle class."

:beer:

Repeals AMT: :thumbsup:
Lowers corp. rate to 30.5%: :thumbsup:

Does so by shifting around the tax code (revenue neutral) to those that make more at the top: (jury still out)

I think that the two reasons above trump a little more for those at the top, especially if it lowers my rates!

Edit: Higher standard deduction....I'm in!

 

[Fern]

Originally posted by: shira

Originally posted by: alchemize
Wow the "rich" definition keeps getting lower according to the democrats doesn't it?

Sorry, a combined income of $150,000 is firmly middle class. That's a network administrator and a peds nurse combined income...or a mid 40's union worker and a teachers.

And $150K on the coasts isn't jack.

Edit: Misread, it's 200K for married couples. I would still classify that as firmly middle to upper-middle class (and still not jack on the coasts).

You're doing more than just misreading:

First, the surcharge applies only to amount of taxable income in excess of 200K (for married couples). Thus, a couple would need to have a taxable income of $201,000 to pay a $40 surtax (4% of the $1,000 taxable income in excess of $200,000).

I'm now hearing that the surcharge applies at the AGI level, not taxable income like we thought?

Haven't seen the bill to confirm. Course, likley no need to bother since it won't pass.

Fern

 

[Fern]

Originally posted by: heyheybooboo

Originally posted by: Fern

See bolded/italicized remarks above,

Edit: I dunno. I don't see C Corp tax returns in there. And I don't feel like footing the sreadsheet to figure it out. So "whatever" as far as that link goes I don't see any label other than "All Returns".

Edit #2: I'm starting to think you're right about it being just 1040's. Found the 2005 data +2% are $200K and above for gross income (but not taxable).

Fern

It's quite good info once you get into it. I'm open to nearly anything as long as it is a reasonable discussion without posturing, pandering manipulative rhetoric. Rangel's plan has good points and not-so-good points and at least it's on the table.

His plan strikes me as having some unusual aspects, particularly for a Dem.

Corp tax rate goes down. What's gonna happen to the stock price?

Ordinarily one would expect it to go up, whether due to higher after-tax earnings (which is how it is reported for investors), increased assets (cash saved from tax reduction), higher EPS & dividend capability etc.

Who benefits from that? Rich people, IMO.

I'm begining to suspect that they may be the bigger beneficiaries of this. Rangel's benefits the wealthy?

I think it possible that the 4% increase on their ordinary income will be more than offset by their portfolio gains and increased dividends (both of which are subject to a reduced rate of tax too).

Fern