Taxpayers are about to be a minority

[Danoff]

YES WE CAN!! YES WE CAN!!! YES WE CAN!!!


...make taxpayers a minority. Obama's budget will raise the number of Americans who don't pay any tax at all from 40% to ~50% (some of those people actually suck money out of the tax system). The moment it hits 51%, we have crossed an important threshold.

We are on the brink of making it so that more voters do not pay a dime in taxes than those that do. The people who do not pay for their government will have a louder voice in its affairs than those that do - and that's a very very bad sign for the size and scope of government to come.

Obama's budget doesn't leave me out either. Early estimates are that it's going to cost me an additional $1000/month in taxes - because I obviously don't already pay enough.

So break out the champagne and get ready to watch the rollover! Pretty soon, taxpayers will be a minority.

 

[mafia_boy]

If there's less taxes going into the budgets of the economy, the government can't afford to pay for all the little things that go around. Less services, less on roads and rail, less help offered by the government, leading into a nice downward spiral. Some of the workers (like yourself for example) who have to pay more now will eventually say "I'll join the slackers" and then they're not paying taxes and round and round it goes.

If that keeps up for a few years, you might aswell call yourselves Zimbabwe.

 

[niky]

Wait, you get a vote for the president of a corporation that you are no longer a stockholder of? Sweet!

 

[YSSMAN]

Would you care to elaborate a bit further, Danoff? Is there a link that I can read more information from?

 

[DaddyVDUB]

I Thought we (tax payers) already were a minority Kinda makes you ashamed of the system.The system of Government offering assistance to those in need,has sadly become a way of life to a whole generation. I know first hand of some who are not yet legal citizens whos total family income is more than mine who recieve every government aid on the books.

YES Lets ALL celebrate!!!!

 

[Danoff]

Would you care to elaborate a bit further, Danoff? Is there a link that I can read more information from?

From http://www.taxfoundation.org/

That was what the plan would do back during the campaign. Now that the economic landscape has changed a little it turns out it would be more like 50%.

 

[Omnis]

Can you imagine the political backlash of getting everyone to pay an even rate? That's going to be a nightmare. I think it would be easier to just get rid of everyone's taxes.

 

[Keef]

Ever thought that maybe their goal is to get rid of the income tax...




...by having Gates and Buffet pay it all?

 

[YSSMAN]

From http://www.taxfoundation.org/

Not that this really has much to do with anything, but I had no idea that Michigan used a flat income tax rate. Interesting. Still makes me wish we would have switched to the consumption tax to fix our budget problems. Would have only had to move to 9% (from 6%), which wouldn't be that big of a deal.

Either way, lets see how Congress handles the budget. Seems like in the interest of "bi-partisanship," some things may get curbed. We'll see.

 

[Kylehnat]

The words "tax return with no liability" trouble me. If my company didn't give an annual bonus, I wouldn't owe anything in April, either. I still pay a buttload into the system, however . Are they talking about actual taxes, or just returns? I find it hard to believe that 50% of Americans won't be paying federal income tax.

 

[McLaren]

Uh, anyone in Canada open to a roommate?

 

[Keef]

The words "tax return with no liability" trouble me. If my company didn't give an annual bonus, I wouldn't owe anything in April, either. I still pay a buttload into the system, however . Are they talking about actual taxes, or just returns? I find it hard to believe that 50% of Americans won't be paying federal income tax.

Everyone who earns a legitimate paycheck has income taxes taken out of it. But so many people rely on the system in whatever way that they end up using more or the same as what they actually put in. Technically I'm paying income tax right now--but really I'm using 9 times more than I'm putting into the system, being on unemployment. Apparently Obama's dealings are going to push the number to 50% of people who get back at least what they put in by using the system, food stamps, refunds, etc.

What else contributes to this number? I'm sure I've missed a few things.

 

[Kylehnat]

That seems nearly impossible. I can't believe that 50% of people fall into that boat (or will).

 

[DaddyVDUB]

As part of my duties at work I double as personell mgr of sorts . In certian jobs we used to have a fairly steady turn over so a lot of new faces,which covered EVERY type of background and race etc. I said that to let you know I do know of what I speak of here. If you all REALLY knew how many folks do not even have taxes taken out of there earnings you would be surprised.A large majority of barely legal to work in USA aliens will claim like 10 to 15 dependants on there W4s which is completely legal to do even if you have NO dependants,so that they will be no FED tax and VERY little SS tax with held. The same for USA citizens then these same folks at years end because of earnings combined with 3 or 4 children will get HUGE tax refunds?????? Wonder why our Government is in a hole? Our Government has long ago told people you can make more money just working the system,it actually COST these folks money to work more hours or a higher earning job.

 

[Sniffs]

as for the classes OTHER than the rich and middle class...like ME...
well, there have been rumors rolling for a decade about a old fashioned revolution. how they'd pull anything off without a taint of Communism is a big fat question.

actually, it's a no-win situation.
if you raise taxes, everybody complains
if you lower them, the poor complain. (they don't get a lowering)

if i were the rest of the world, I'd worry more about the americans that make poverty line or below.

 

[FoolKiller]

I'd be interested to see where I fall in all that.

I don't blatantly use any government programs, like food stamps or welfare, have no kids in school, or any of that stuff. But politicians make it sound like I am on the verge of poor.

 

[Danoff]

Everyone who earns a legitimate paycheck has income taxes taken out of it. But so many people rely on the system in whatever way that they end up using more or the same as what they actually put in. Technically I'm paying income tax right now--but really I'm using 9 times more than I'm putting into the system, being on unemployment. Apparently Obama's dealings are going to push the number to 50% of people who get back at least what they put in by using the system, food stamps, refunds, etc.

What else contributes to this number? I'm sure I've missed a few things.

I don't think that things like food stamps are included in these numbers - but I'm not sure how food stamps work because I've never gotten them. Unemployment also doesn't count toward these numbers.

It's not a measure of getting more out of the government as a whole than you put in. It's just a measure of how much of your paycheck gets taken for taxes.

For example, I have a colleague who makes about $100k/year and pays about $2k/year in taxes. Well, Obama's plan will almost certainly give him $2k worth of tax credits - reducing his liability to zero.

He's married, his wife doesn't work, and he has 4 kids. He also has a substantial mortgage and pays lots of property tax. He makes contributions to his 401k and IRAs and uses a health care spending account. Off the top of my head:

$100k-$15k(401k)-$5k(health care)-$4k(IRA)-$20k(mortgage interest)-$5k(property tax)-$8k(personal exemption)-$4k(child tax credit)-$15k(child tax deduction)

That's a resulting income of $24k.

The tax on a 24k income is

"$1,565 plus 15% of the amount over $15,650"


That's roughly $2,800 - which means I missed about $800 of tax credits.


Now, let's pretend for a moment that you ended up with zero after taking out all of those deductions. Do you pay zero tax? Why no. No you get an "earned income" tax credit - which means you get a refund despite the fact that you paid nothing in. If you ever see the phrase "earned income" on your taxes, I believe that means you're paying a negative tax rate overall. I fully expect that my buddy - who I've used as an example here - will have zero tax liability under Obama's plan.

 

[YSSMAN]

I don't blatantly use any government programs, like food stamps or welfare, have no kids in school, or any of that stuff. But politicians make it sound like I am on the verge of poor.

Same here. I don't qualify for the EIC, and I don't believe that my tuition was able to be claimed this year, and I otherwise receive no benefits from the government whatsoever other than the loans that I'm already paying back.

Although, this year could get interesting. I was making my way pretty well as a single filer for 2008, but with the significant cuts in pay that I've had, its hard to know for sure what will happen. But, I'm not a part of any government program other than my loans, soooo, yeah.

 

[wfooshee]

If there's less taxes going into the budgets of the economy, the government can't afford to pay for all the little things that go around. Less services, less on roads and rail, less help offered by the government, leading into a nice downward spiral. Some of the workers (like yourself for example) who have to pay more now will eventually say "I'll join the slackers" and then they're not paying taxes and round and round it goes.

If that keeps up for a few years, you might aswell call yourselves Zimbabwe.

That's not what he's saying. He's saying that fewer people are paying the taxes.

Those at the top of that heap are gonna have to put in more than before.

That's been the Democratic Party's "redistribution" goal for . . . . well, forever, it seems, and the main reason I've never voted Democratic, no matter what else may be out there.

There is a mis-guided perception by the "have-nots" that they are entitled to the same privilege and comfort as the "haves" despite differences in effort, education, achievement, and ability.

I consider myself a "have-not" but it has never crossed my mind that I am entitled to anything more than I've earned and obtained for myself. Genuine assistance in a time of need is one thing, but handouts because you have no skills, or live in a foreign country, are another thing altogether.

There is an old joke about a college professor arguing politics with a very "liberal"-minded student, where the professor states his argument by telling the student her A just became a B so her roommate's C could come up to a B. The student was of course quite irate that the grade she worked so hard to achieve could be given away to a person who didn't do any of the work required for the achievement.

 

[Danoff]

I don't think that things like food stamps are included in these numbers - but I'm not sure how food stamps work because I've never gotten them. Unemployment also doesn't count toward these numbers.

It's not a measure of getting more out of the government as a whole than you put in. It's just a measure of how much of your paycheck gets taken for taxes.

For example, I have a colleague who makes about $100k/year and pays about $2k/year in taxes. Well, Obama's plan will almost certainly give him $2k worth of tax credits - reducing his liability to zero.

He's married, his wife doesn't work, and he has 4 kids. He also has a substantial mortgage and pays lots of property tax. He makes contributions to his 401k and IRAs and uses a health care spending account. Off the top of my head:

$100k-$15k(401k)-$5k(health care)-$4k(IRA)-$20k(mortgage interest)-$5k(property tax)-$8k(personal exemption)-$4k(child tax credit)-$15k(child tax deduction)

That's a resulting income of $24k.

The tax on a 24k income is

"$1,565 plus 15% of the amount over $15,650"


That's roughly $2,800 - which means I missed about $800 of tax credits.


Now, let's pretend for a moment that you ended up with zero after taking out all of those deductions. Do you pay zero tax? Why no. No you get an "earned income" tax credit - which means you get a refund despite the fact that you paid nothing in. If you ever see the phrase "earned income" on your taxes, I believe that means you're paying a negative tax rate overall. I fully expect that my buddy - who I've used as an example here - will have zero tax liability under Obama's plan.

Actually, I misapplied the child tax credit - I applied it as a deduction. It should be like this:

$100k-$15k(401k)-$5k(health care)-$4k(IRA)-$20k(mortgage interest)-$5k(property tax)-$8k(personal exemption)-$15k(child tax deduction)

= 28k of taxable income.

That's $3417 in tax. Now the $4k child tax credit gets applied - which reduces the tax liability to $0.

He must be making more than $100k. Actually, I might be able to calculate that. What would get his tax liability to $6k before the child tax credit? ~$45k

So he's making $112,000. Yea that sounds about right - that leaves him with $2k in tax (before the Obama plan, it'll probably be zero again after).

 

[YSSMAN]

I've yet to hear actual specifics on his plan for deductions, although his plan for the $800 credit for "working families" comes to mind. How that will be broken up by income, I don't know.