Oh my God! Taxes go up at the end of this year!!11!

[flamin lib]

I've been thinking about how draconian the end of the Bush tax cuts to the top 5% would be. The top rate would go from 35% to 39% but only on taxable income over $250,000. So, if your income after all deductions is $20,800 a month your tax liability will go up $0. If your taxable income is $25,000 a month your tax hike would amount to $166 on the extra $4,200. I've had bar tabs bigger than that!

The talking point is that taxes will rise 10%. Well, yeah, 4% is roughly 10% of the existing 35% top rate. That's called telling the truth attractively. But another way to see it is that, at $300,000 a year, you will pay an additional .6% in taxes on your total taxable income. As the income increases the % of total income paid in increased taxes rises so that at at $ Million the increase would be 3% of total taxable income. This is also telling the truth attractively.

I really can't understand the fear and loathing that's being generated by the possible 4% increase in the top rate. In the '50s the top rate on income over $5,000,000 was 92% and it is recognized as a time of great prosperity.

Knowledge is power, arm yourself.

[Juche]

1. Now businesses won't hire

With corporate profits only increasing by about $600 billion a year in the last year, this tax increase will stop the hand over fist hiring that the private sector is doing.

[OneTenthofOnePercent]

2. What if you make under $100k? $75k? $50k?

I'm just curious as to what normal incomes would be.

[flamin lib]

6. If all goes as Obama plans the rates and deductions below $250k

would not change.

On the bright side the extension of cuts to the lower 95% can be done in reconciliation which is how the Republicans passed the Bush tax cuts to begin with.

[OneTenthofOnePercent]

8. If nothing changes as of today... what will happen?

As far as I'm concerned, despite sweeping 2008 elections, changes for the better are still few and far between. At this point I'm really not interested in Obama's "plans" "promises" or any other Congressional/Liberal "Hope". That ship has sailed and there's very little hope for change to be had. In regard to any politicians... I'll believe it when I see it.

So... when the tax cuts are ended, assuming nothing else changes, what can NORMAL people expect to happen to their taxes?
I really want to know and there's so much BS on the internet I don't know will happen for me (my household).

[flamin lib]

14. Ya' know, I get really weary of the "they're all the same" and "nothing's changed"

rant. This has been the most successful administration since LBJ. In fact, Obama has passed LBJ's record of accomplishment and he hasn't had a whole term. Have got EVERY SINGLE POSSIBLE THING WE WANT? No but I suggest you google Obama accomplishments ans see what ya' come up with.

[KansasVoter]

3. Nice Post!

[wtmusic]

4. Please, raise my taxes.

I don't make anywhere near $250K, but I'm tired of government going into debt to pay expenses.

If Republicans want to cover the interest and have collateral to cover it, they can have a lower tax rate. So when China comes knocking at the door for repayment on muni bonds, they can start handing over their yachts and beach houses.

[gratuitous]

5. The fear and loathing that's being generated comes from those who own the microphones

And guess how much even the lowliest talking chucklehead on your teevee makes each year?

[slackmaster]

7. I figure mine would go up by about $2,300 per year if all of the cuts are allowed to expire

That's not a trivial amount of money to me.

[flamin lib]

10. Working backward from your $2300 if you qualify for the top 5%

your taxable income must be somewhere near $310k. That means you'd pay an additional .7% of your total income in taxes. If you aren't one of the top 5% that $2300 must include the increased dependent deductions as well as the income tax in which case you shouldn't see an increase.

[slackmaster]

11. No, my taxable income is about 1/4 of that, and I have no dependents.

The rate for the $0 - $8,500 bracket would increase from 10% to 15%.
The rate for the $34,550 - $83,700 bracket would increase from 25% to 28%.

[flamin lib]

13. That is assuming that the cuts for the 95% cannot be extended

or made permanent. The plan is to only let the cuts on income above $250k expire so you should see no changes to your tax structure unless the Republicans can block the extension in the senate. If they do there is always reconciliation which is how the Republicans passed the cuts in '01 & '03.

The down side to reconciliation is that it's limited to 10 years. Reconciliation cannot increase the deficit beyond 10 years which is why the Bush tax cuts are expiring.

[slackmaster]

15. Please don't move the goalpost. The discussion is about what would happen if all the cuts expire.

The plan is to only let the cuts on income above $250k expire...

I haven't seen a plan in writing, or formally presented to Congress yet. I'll believe that cuts on middle-income taxes will be preserved when I see a real plan.

That said, I don't have any problem with allowing the cuts on income over $250K to expire. Let's try to keep the discussion objective.

[flamin lib]

16. Don't know which OP you read but the one I posted began with

"I've been thinking about how draconian the end of the Bush tax cuts to the top 5% would be."

[slackmaster]

17. Fair enough, but that's not the entirety of the Bush tax cuts.

I apologize for misrepresenting your position.

[flamin lib]

19. Funny thing, I was just considering the snide level in my reply and

thinking I should apologize since the edit period had passed. Then I check in to do so see your reply. No harm, no foul and accept my own apology for being less than civil.

[Jakes Progress]

9. If knowledge is power, the electorate is a candy ass.

A frightened, pointlessly fuming candy ass.

[flamin lib]

12. You are absolutely right and it's a damn shame. nt

[Xenotime]

18. Anybody making over $250k should be able to handle the increase..

[SammyWinstonJack]

20. +{1.