the HENRY class - High Earners, Not Rich Yet

[AreaCode707]

One person here implied that people working into their 60s or 70s have to do so because they lived beyond their means. While that might be true in some circumstances, it isn't fair to generalize that to an entire group of people. I will work into my 60s and maybe later, but it isn't because I lived beyond my means -- it is because I choose to enjoy life now rather than live like a poor person hoping that I can save up and retire early. Plus I think I would get bored having nothing to do. The bottom line is that you never know what is going to happen down the line, so you should try to enjoy life now rather than putting it off.

I didn't mean to imply that all people working in their 60s and 70s lived profligately. I was responding to the poster who said anyone who could afford to retire earlier deserved to have their extra income taxed away. There definitely are a variety of very valid reasons people work those extra decades but just because some people choose to deprive themselves earlier in life in order to retire earlier doesn't mean that they deserve to carry a heavier tax burden.

 

[IndyColtsFan]

I didn't mean to imply that all people working in their 60s and 70s lived profligately. I was responding to the poster who said anyone who could afford to retire earlier deserved to have their extra income taxed away. There definitely are a variety of very valid reasons people work those extra decades but just because some people choose to deprive themselves earlier in life in order to retire earlier doesn't mean that they deserve to carry a heavier tax burden.

Fair enough, and I do agree with that. :thumbsup:

 

[IndyColtsFan]

/office space

The bobs are coming! The bobs are coming!

What's the big deal? They're just consultants holding a few meetings.

No! You don't understand! Those "meetings"? They are interviews! You're interviewing for you own damn job and you'll likely not get it.

BOB #1: "Looks like you've been missing a lot of work lately."
PETER: "I wouldn't say I've been missing it, Bob!"

 

[Turin39789]

"The HENRYs weren't saving much before," says Glassman. "Now, they're dipping into their savings and investments to maintain something close to their former lifestyles."

Am I reading that right? More taxes aren't fair because they have a low savings rate?

 

[AreaCode707]

Am I reading that right? More taxes aren't fair because they have a low savings rate?

That's what it says, but it's a dumbass statement. How much you have in savings, how much credit card debt you have and how close you live to the financial line each month has nothing and should have nothing to do with how you're taxed.

 

[Argo]

The rich have nothing to gain by revolting in the US so they revolt with their feet. It was well publicized last year when one of NY state's richest men finally moved full time to Florida to avoid the huge taxation from NY and he said it was for tax reasons and there was no reason not to believe it. People do leave for tax reasons. It's a primary reason why NY state is not competitive to business and has a flat state population. Taxes are part of the household economy and obviously people move for economic reasons, from state to state or country to country. It's always a fine balance bleeding as much from the host as you can before it wakes up and runs off. I don't know where that is, but certainly the rich have means to act if they find an environment ultimately not worth its cost.I agree with this in most cases. Sometimes even if you're salaried you do "have" to work longer because if you don't you could get squeezed out of promotions or even your job. I've heretofore been lucky enough, even working in IT for a decade, to work 40 hour weeks and I am evangelical about their importance to me. I don't want to burn up youth or time with my kids spending more time at work than necessary. I'm positive I could make more if I switched to a different job demanding more time from me but I have it sweet where I am now.

Thanks for explaining my point to him. Apparently, it went way over his head

 

[Paul98]

oh boo ho the top has to pay a little bit more on the top amount of money they make. Make a portion of that money work for you and stop bitching.

 

[Blackjack200]

Thanks for explaining my point to him. Apparently, it went way over his head

Yeah, I guess the part that's still going way over my head is where exactly "civil war" comes into play.

 

[djmartins]

Let alone be a whinny racist like you because the “Black man is holding me down…”

Actually it isn't the black man holding anyone down, it is the Jew in the government with the whole welfare state and socialist ideology who steals from those who produce and gives it to those who don't.
Now, I bet you are dying to call me a word invented by the commie, racist, but the fact is it the US government and society that implements and condones cultural marxism and affirmative action are the ones who use race to judge people.

 

[Jhhnn]

High earners have a multiplicity of ways to both reduce their tax burdens and save for retirement. Many professional sole practitioners can set up their business as a "S" corp, pay themselves dividends rather than salary, avoid SS on that amount. That's just a start. Others who have corporate employment can easily take full advantage of a variety of tax deferred plans- 401K's, IRA's, so forth and so on. The list goes on from there.

One of the most remarkable things about any such discussion is that few participants have any grasp of history wrt the subject of taxes. Prior to Reagan, high earners paid a much higher average tax rate, and had smaller incomes, both in terms of share of total income and inflation adjusted dollars, but they managed to get by somehow... In the meanwhile, the top 1&#37; share of income has risen from <9% to > 23% while their federal tax rate has fallen by roughly 1/3, from 34% to 22%.

And the whining and threats have never been louder or more persistent, the obfuscations for compulsive greed and entitlement never more elaborate. Cutting taxes at the top is starting to look a lot like feeding the bears- the more they get, the more they want, and the more threatening they become when they don't get it...

 

[Blackjack200]

Actually it isn't the black man holding anyone down, it is the Jew in the government with the whole welfare state and socialist ideology who steals from those who produce and gives it to those who don't.
Now, I bet you are dying to call me a word invented by the commie, racist, but the fact is it the US government and society that implements and condones cultural marxism and affirmative action are the ones who use race to judge people.

Whatever you say there Adolf.

 

[BlahBlahYouToo]

High earners have a multiplicity of ways to both reduce their tax burdens and save for retirement. Many professional sole practitioners can set up their business as a "S" corp, pay themselves dividends rather than salary, avoid SS on that amount. That's just a start. Others who have corporate employment can easily take full advantage of a variety of tax deferred plans- 401K's, IRA's, so forth and so on. The list goes on from there.

One of the most remarkable things about any such discussion is that few participants have any grasp of history wrt the subject of taxes. Prior to Reagan, high earners paid a much higher average tax rate, and had smaller incomes, both in terms of share of total income and inflation adjusted dollars, but they managed to get by somehow... In the meanwhile, the top 1% share of income has risen from <9% to > 23% while their federal tax rate has fallen by roughly 1/3, from 34% to 22%.

And the whining and threats have never been louder or more persistent, the obfuscations for compulsive greed and entitlement never more elaborate. Cutting taxes at the top is starting to look a lot like feeding the bears- the more they get, the more they want, and the more threatening they become when they don't get it...

fair tax.
lets implement it.

 

[AreaCode707]

High earners have a multiplicity of ways to both reduce their tax burdens and save for retirement. Many professional sole practitioners can set up their business as a "S" corp, pay themselves dividends rather than salary, avoid SS on that amount. That's just a start. Others who have corporate employment can easily take full advantage of a variety of tax deferred plans- 401K's, IRA's, so forth and so on. The list goes on from there.

One of the most remarkable things about any such discussion is that few participants have any grasp of history wrt the subject of taxes. Prior to Reagan, high earners paid a much higher average tax rate, and had smaller incomes, both in terms of share of total income and inflation adjusted dollars, but they managed to get by somehow... In the meanwhile, the top 1% share of income has risen from <9% to > 23% while their federal tax rate has fallen by roughly 1/3, from 34% to 22%.

And the whining and threats have never been louder or more persistent, the obfuscations for compulsive greed and entitlement never more elaborate. Cutting taxes at the top is starting to look a lot like feeding the bears- the more they get, the more they want, and the more threatening they become when they don't get it...

Tax me at 50% of purchase price for luxury items, please!!!

Let me live the same life as my neighbor, with the same food, same car, and rent/mortgage at the same tax rate. As long as my life is identical to my neighbor, don't treat me differently.

When I buy a boat, or a second car or designer clothes or put my kids in a private school, charge me for that. Skim off my luxurious lifestyle to support those who need it.

Just stop skimming money off my paycheck and then LITERALLY sending it in a check (2008 tax refund) to my renter-roommates, who drive fancy cars, travel and pay half the taxes I do.

 

[Jhhnn]

Tax me at 50% of purchase price for luxury items, please!!!

Let me live the same life as my neighbor, with the same food, same car, and rent/mortgage at the same tax rate. As long as my life is identical to my neighbor, don't treat me differently.

When I buy a boat, or a second car or designer clothes or put my kids in a private school, charge me for that. Skim off my luxurious lifestyle to support those who need it.

Just stop skimming money off my paycheck and then LITERALLY sending it in a check (2008 tax refund) to my renter-roommates, who drive fancy cars, travel and pay half the taxes I do.

That's it- quote me, and then don't address a single thing I said- just argue for a system that'll cut your taxes even more, point fingers at somebody, anybody, else...

Tax refund checks? how lame. That's the difference between what was withheld from their paychecks and the amount actually owed in taxes... having nothing whatsoever to do with the subject at hand...

 

[CountZero]

That's it- quote me, and then don't address a single thing I said- just argue for a system that'll cut your taxes even more, point fingers at somebody, anybody, else...

Tax refund checks? how lame. That's the difference between what was withheld from their paychecks and the amount actually owed in taxes... having nothing whatsoever to do with the subject at hand...

For what it is worth there are some people that get money back from the government that they didn't pay. I don't know how common it is and I doubt it applies to anyone taking trips and driving nice cars.

 

[Jhhnn]

For what it is worth there are some people that get money back from the government that they didn't pay. I don't know how common it is and I doubt it applies to anyone taking trips and driving nice cars.

You mean the WalMart subsidy? Immaterial to the discussion at hand.

 

[BlahBlahYouToo]

Tax me at 50% of purchase price for luxury items, please!!!

Let me live the same life as my neighbor, with the same food, same car, and rent/mortgage at the same tax rate. As long as my life is identical to my neighbor, don't treat me differently.

When I buy a boat, or a second car or designer clothes or put my kids in a private school, charge me for that. Skim off my luxurious lifestyle to support those who need it.

Just stop skimming money off my paycheck and then LITERALLY sending it in a check (2008 tax refund) to my renter-roommates, who drive fancy cars, travel and pay half the taxes I do.

sounds like another fair tax supporter.

 

[TruePaige]

Tax me at 50% of purchase price for luxury items, please!!!

Let me live the same life as my neighbor, with the same food, same car, and rent/mortgage at the same tax rate. As long as my life is identical to my neighbor, don't treat me differently.

When I buy a boat, or a second car or designer clothes or put my kids in a private school, charge me for that. Skim off my luxurious lifestyle to support those who need it.

Just stop skimming money off my paycheck and then LITERALLY sending it in a check (2008 tax refund) to my renter-roommates, who drive fancy cars, travel and pay half the taxes I do.

Unless an individual makes over $200,000 they will pay more under the Fair Tax plan, which is the greatest sham foisted by the greedy and ignorant poor upon the middle class in this age.

Not to mention the proposed 23% Fair Tax is really a 30% Fair Tax in explicit terms (as 23% is a marketing ploy, measuring it in implicit terms). They love to compare this to the explicit income tax and fool those who are mathematically challenged.

If a suit costs $100 and a 30% sales tax is in effect, you will pay $130 for the suit. Suit cost is $100. Tax is $30. That is a 30% EXPLICIT tax rate ($30 / $100) = 30%.

If total cost for a suit is $130, including $30 tax, you will pay the SAME $130 for the suit. Suit costs $100. Tax is $30. That is a 23% IMPLICIT tax rate ($30/$130) = 23%

I could talk about points on why this is a sham all day, but here is a (somewhat decent, but doesn't show near as many flaws as it really has) analysis of the Fair Tax.

http://www.factcheck.org/taxes/unspinning_the_fairtax.html

I honestly wish I could let the people who want a tax system like that test drive it for a year. They'd be living a dramatically lowered quality of life. All the information is out there, and it's not hard to see who benefits from this. They've even tried to get more suppose from the trashier segments by bolting on these prebates (large tax cuts through this system visible for those under ~25k), as if the entire basis of the flat tax overlaid on this countries income demographics doesn't show the middle class getting screwed enough.

 

[AHenry]

The rich have nothing to gain by revolting in the US so they revolt with their feet. It was well publicized last year when one of NY state's richest men finally moved full time to Florida to avoid the huge taxation from NY and he said it was for tax reasons and there was no reason not to believe it. People do leave for tax reasons. It's a primary reason why NY state is not competitive to business and has a flat state population. Taxes are part of the household economy and obviously people move for economic reasons, from state to state or country to country. It's always a fine balance bleeding as much from the host as you can before it wakes up and runs off. I don't know where that is, but certainly the rich have means to act if they find an environment ultimately not worth its cost.I agree with this in most cases. Sometimes even if you're salaried you do "have" to work longer because if you don't you could get squeezed out of promotions or even your job. I've heretofore been lucky enough, even working in IT for a decade, to work 40 hour weeks and I am evangelical about their importance to me. I don't want to burn up youth or time with my kids spending more time at work than necessary. I'm positive I could make more if I switched to a different job demanding more time from me but I have it sweet where I am now.

Note that not only individuals are voting with their feet by moving to more tax friendly states but so are entire corporations. CA, NJ, MA, NY and a number of high tax states have lost and continue to lose major corporations. A company I previously worked for moved its entire corporate headquarters from Irvine, CA to Irving, TX. The primary reason was the high corporate taxes and high individual taxes.

Why did high individual taxes have any bearing you ask? Because it drove up the cost of resources (e.g. engineers). High taxes and high cost of living pushed salaries so high the company could not be competitive working out of CA. Solution: Move to a business and tax friendly state.

 

[AHenry]

That's it- quote me, and then don't address a single thing I said- just argue for a system that'll cut your taxes even more, point fingers at somebody, anybody, else...

Tax refund checks? how lame. That's the difference between what was withheld from their paychecks and the amount actually owed in taxes... having nothing whatsoever to do with the subject at hand...

Actually, you are showing your ignorance of the problem. A large and growing fraction of US population actually get money back from the IRS and pay not one dime in Federal Taxes.

This is the result of Tax Credits which apply with or without tax liability.

 

[AreaCode707]

Unless an individual makes over $200,000 they will pay more under the Fair Tax plan, which is the greatest sham foisted by the greedy and ignorant poor upon the middle class in this age.

I'm not arguing in favor of any currently-proposed plan. I am certain a tax plan could be drafted that wouldn't fit your description above. It's simply a matter of what items you choose to tax and how much tax is applied.

Not to mention the proposed 23% Fair Tax is really a 30% Fair Tax in explicit terms (as 23% is a marketing ploy, measuring it in implicit terms). They love to compare this to the explicit income tax and fool those who are mathematically challenged.

If a suit costs $100 and a 30% sales tax is in effect, you will pay $130 for the suit. Suit cost is $100. Tax is $30. That is a 30% EXPLICIT tax rate ($30 / $100) = 30%.

If total cost for a suit is $130, including $30 tax, you will pay the SAME $130 for the suit. Suit costs $100. Tax is $30. That is a 23% IMPLICIT tax rate ($30/$130) = 23%

I could talk about points on why this is a sham all day, but here is a (somewhat decent, but doesn't show near as many flaws as it really has) analysis of the Fair Tax.

http://www.factcheck.org/taxes/unspinning_the_fairtax.html

I honestly wish I could let the people who want a tax system like that test drive it for a year. They'd be living a dramatically lowered quality of life. All the information is out there, and it's not hard to see who benefits from this. They've even tried to get more suppose from the trashier segments by bolting on these prebates (large tax cuts through this system visible for those under ~25k), as if the entire basis of the flat tax overlaid on this countries income demographics doesn't show the middle class getting screwed enough.

Hence why I'm not arguing for an existing proposed plan, instead proposing an alternative model.

 

[AreaCode707]

That's it- quote me, and then don't address a single thing I said- just argue for a system that'll cut your taxes even more, point fingers at somebody, anybody, else...

If you've read my posts you'll see I don't have a problem with paying what I pay in taxes, or even paying more. My problem is that the government taxes me more than somebody else who lives an identical lifestyle. I don't intend to live this way forever and I have NO PROBLEM if the government taxes the shit out of unnecessary items I eventually purchase.

Tax refund checks? how lame. That's the difference between what was withheld from their paychecks and the amount actually owed in taxes... having nothing whatsoever to do with the subject at hand...

I wasn't talking specifically about normal tax refunds, I was talking about the 2008 tax rebate program:
http://usgovinfo.about.com/od/incometaxandtheirs/a/rebates2008.htm

I paid four times in taxes what my roommates did and yet they received rebate checks and I didn't, all while I pretty much subsidized their housing and lived less a less spendy lifestyle. So the government is directly penalizing me for being a good earner, a landlord and a saver.

 

[AreaCode707]

sounds like another fair tax supporter.

I haven't pretended to be anything else, although, as evidenced by TruePaige's post, I don't support any existing fair tax plan.

Anyone decides to throw their money after luxuries should be paying to support those who cannot. Allowing people who are responsible with their time, earnings, education and savings to apply that money wisely without penalty is ultimately a good thing for business.

If someone makes a mint and spends it on luxuries, they aren't doing much with their cash to otherwise stimulate the economy and their taxes on those luxury purchases make up for that.

If someone makes a mint and, rather than indulging himself, sinks it right back into business then the government is getting their benefit through the economic stimulation and shouldn't be using taxes to take a fat chunk off the income and therefore degrade that person's ability to perpetuate economic improvement.

 

[Tom]

Actually, you are showing your ignorance of the problem. A large and growing fraction of US population actually get money back from the IRS and pay not one dime in Federal Taxes.

This is the result of Tax Credits which apply with or without tax liability.

EIC is income redistribution, championed by Ronald Reagan and other conservatives. The catch is recipients have to work to get it.

If you're opposed to it, what is your solution for poverty and the working poor ?

remember, the poor spend that money, it isn't wasted.

 

[Jhhnn]

If you've read my posts you'll see I don't have a problem with paying what I pay in taxes, or even paying more. My problem is that the government taxes me more than somebody else who lives an identical lifestyle. I don't intend to live this way forever and I have NO PROBLEM if the government taxes the shit out of unnecessary items I eventually purchase.



I wasn't talking specifically about normal tax refunds, I was talking about the 2008 tax rebate program:
http://usgovinfo.about.com/od/incometaxandtheirs/a/rebates2008.htm

I paid four times in taxes what my roommates did and yet they received rebate checks and I didn't, all while I pretty much subsidized their housing and lived less a less spendy lifestyle. So the government is directly penalizing me for being a good earner, a landlord and a saver.

Heh. So you didn't get your measly $250 two years ago and you're still whining about it, making that a generalized argument wrt taxes in general? Why didn't you get a rebate on your 2007 taxes, anyway? You forgot to mention that you got a taxbreak on mortgage interest, in the first place, and haven't made it clear if you paid taxes on the rent roommates paid to you, either...

True Paige covered the rest... other than your appeal to the false gods of trickle down economics...