The Market Ticker
Rss Icon RSS available
You are not signed on; if you are a visitor please register for a free account!
Comments on Reality On So-Called 'Tax Cuts'
User: Not logged on
Top Forum Top Login FAQ Register Clear Cookie
Showing Page 2 of 2  First12Last
User Info Reality On So-Called 'Tax Cuts' in forum [Market-Ticker]
Analog
Posts: 1494
Incept: 2010-12-29

arkansas ozarks
Report This As A Bad Post Add To Your Ignored User List
Quote:
I'll take the risk of being taxed at higher rates later in exchange for not paying them now, since that still only gives them one bite at the apple.


So far it's been advantageous for me to have stashed money long ago pretax and pay taxes on it now . Then i was in ~25% bracket now it's more like 2% . With current inflation and bracket creep what you make now will in a decade be near poverty line and almost tax free.

So yes, if they give you a chance to avoid tax now take it.

Roth makes sense to me only if one knows he can 'make a killing' .

a.

----------
Never trust a computer with anything important.
Ee4fire
Posts: 345
Incept: 2011-03-24

Washington, DC
Report This As A Bad Post Add To Your Ignored User List
I think they should do away with the income tax completely, but that will happen when hell freezes over. So why not get rid of all deductions, put a cap on charitable contributions and lower the rates. Put an exemption on the first $15000 to $25000 of income and then graduate the income tax.

Up to $100,000 10% on all income with a $5,000 cap on tax free charitable contributions.
Up to $1,000,000 15% on all income with $50,000 cap on tax free charitable contributions.
Up to $5,000,000 20% on all income with $125,000 cap on tax free charitable contributions.
Above $5,000,000 25% on all income with $500,000 cap on tax free charitable contributions

No estate taxes. Stop all tax free contributions to non Roth IRA and 401(k). Allow conversion of existing tax free retirement plans with a 10 to 20% tax payment on the gross amount and all retirement plans are funded with taxable income and the amount pulled out is non taxable after you retire after 62 years of age. No tax liability on income or capital gains in a defined retirement plan.

Everyone knows what their tax bill will basically be instead of guessing. The tax code will no longer be used for political and social engineering.

Couple that with a balanced budget amendment to the Constitution.

I can dream this will actually happen.




----------
(Politicians), 536 commoditized temple monkeys pawing through the ruins of America in search of bribes. (The District of Corruption) works like a vending machine. You put coins in the slot, select your law, and the desired legislation slides out." Fred Reed. Some editting by me.


Macthor
Posts: 19
Incept: 2009-09-16

Report This As A Bad Post Add To Your Ignored User List
Quote:
The only thing I see that's good in the proposed changes are the doubling of the standard deduction which is a definite positive for everybody, especially those in the middle class -- most of whom do not itemize. In fact virtually nobody does with under $100,000 of income because it makes no sense to do so. In addition, where the individual mandate to get struck (which I rate as having about a 1 in 100 probability) that would be a great thing from a standpoint of freedom -- but it will certainly crash the rest of Obamacare should it occur.


The first time I read this passage I had the same reaction as Barley. "Virtually nobody does" reads like we're talking about the current law. There are plenty of folks who make under $100,000 who currently itemize. It's fairly trivial for a married couple to exceed $12,600 in deductions, especially in states with an income tax. They wouldn't need to be highly leveraged, either. However, if the standard deduction doubles, it would be "virtually nobody." It just wouldn't make sense to have itemized deductions in excess of 25% of your income. This provision would flip a lot of itemizers to the standard deduction. This is what is making realtors and mortgage lenders go crazy, as they can no longer sell the tax "benefits" of home ownership.

What's absurd is the JCT's analysis that creates a tax "hike" on the poor which is entirely based on them losing their Premium Tax Credit if they don't buy insurance. It's a subsidy against money you're spending, not an income tax. If you don't spend the money, you don't get the credit!

If only Congress would expend this energy on the real problem - the bezzle in health care and financials - the need for tax reform like this would go away.
Tickerguy
Posts: 150660
Incept: 2007-06-26
A True American Patriot!
Report This As A Bad Post Add To Your Ignored User List
Exactly.

But the fact is that with the SD doubling there's no reason to itemize unless you're north of $100k AGI.

Even today, without it, $12,600 in deductions? In a high-tax state with too much leverage on your books, yep. Especially if you went out and bought a maximum-leverage $300,000 house with nothing on the table. Which many people did.

Rewarding that is beyond stupid as you're rewarding people getting into a hole that leaves them one financial problem away from INSTANT bankruptcy and homelessness.

Even so, doubling the standard deduction means it simply won't happen unless you're flat out ****ing insane with the leverage you've taken on.

----------
Winding it down.
Rollformer
Posts: 78
Incept: 2013-02-13

Report This As A Bad Post Add To Your Ignored User List
Regarding the leverage in home loans, my father is an ad valorem appraiser in North Carolina (works for a county). He often gets calls from real estate agents to reduce the value of a property such that the taxes go down only $100 A YEAR. Or else, the mortgage company won't underwrite the loan. What happens if you stub your toe, let alone blow a tire?
Little_eddie
Posts: 1097
Incept: 2009-04-30

Delaware
Online
Report This As A Bad Post Add To Your Ignored User List
"see below' didn't show up for me,


Think of how stupid the average person is, and realize half of them are stupider than that. - George Carlin

----------
Think of how stupid the average person is, and realize half of them are stupider than that. - George Carlin

Asimov
Posts: 109562
Incept: 2007-08-26

East Tennessee Eastern Time
Report This As A Bad Post Add To Your Ignored User List
Ee4fire: Even simpler - https://fairtax.org/index

----------
It's justifiably immoral to deal morally with an immoral entity.

Festina lente.
Analog
Posts: 1494
Incept: 2010-12-29

arkansas ozarks
Report This As A Bad Post Add To Your Ignored User List
Quote:
----------
Think of how stupid the average person is, and realize half of them are stupider than that. - George Carlin


Sorry eddie , sometimes my own klutz factor just amazes me.

a.

----------
Never trust a computer with anything important.
Macthor
Posts: 19
Incept: 2009-09-16

Report This As A Bad Post Add To Your Ignored User List
What's fascinating to me is the state shenanigans that might ensue.

The removal of the SALT deduction increases the "effective" state income tax rate of taxpayers who are accustomed to writing off their state taxes on their federal return. In general, blue states pay higher rates than red ones. This could lead to an influx of taxpayers to Texas and Florida where they won't have to pay state income tax (and won't get "penalized" for that on their 1040).

Also, many states (like mine) force you to take the standard deduction on your state return if you do so on your 1040, even if itemizing would be better at the state level. (The reverse is also true - you have to itemize on your state return if you do on federal.) In VA the state standard deduction is $3K/$6K. I have a feeling a lot of these low-six-figure taxpayers who flip from itemized to standard on federal will be in for a rude awakening on their state returns!
Mannfm11
Posts: 5415
Incept: 2009-02-28

DFW, Tx
Report This As A Bad Post Add To Your Ignored User List
I would get rid of tax credits and the carried interest. Short term losses, short term gains. When I took tax years ago, running a business that made its money by buying and selling assets made ordinary income.

I support the lower corporate taxes, because I don't believe the higher rate was ever meant to tax big corporations, but limit startups. Taking 40% of the capital from a growing young company doesn't make sense. The multinationals build it into their costs.

The doubling of the standard deduction is the tax cut. It is worth $100 to $200 a month to most households. Limiting state tax deductions is also okay. I'm tired of subsidizing profligate government spending.

----------
The only function of economic forecasting is to make astrology look respectable.---John Kenneth Galbraith
Ckaminski
Posts: 4311
Incept: 2011-04-08

Mass-Hole!
Report This As A Bad Post Add To Your Ignored User List
Quote:
I support the lower corporate taxes


I'm personally a fan of no corporate taxes, unless you're using slave labor in 3rd world ****holes, and then it's in the form of tariffs, and it's applied fairly to everyone.

Taxes on corporations are taxes on you and I at point of sale. No thanks.
Login Register Top Blog Top Blog Topics FAQ
Showing Page 2 of 2  First12Last