Archive for Wednesday, December 19, 2012

Letter: Tax calculations

December 19, 2012


To the editor:

Got to thinking about the position that President Obama is taking on raising taxes on the top 2 percent, those making over $250,000. That is adjusted gross income. In other words, that is the amount on which an individual would pay tax. That means that the family would deduct the interest on both of their homes, medical expenses, charities, home office, telephones for business, country club dues when used to entertain clients, half of their entertainment meals, etc. What was left would be the $250,000. Total income could easily be $400,000-plus. You also have to remember that stock dividends are not taxed.

When I divided the number $250,000 by 12, I came to the realization that it equals what a person making $10/hour makes in a year, $20,830. If the tax rate increase should go into effect, then the 3 percent increase would cost the lowest end high earner, i.e., $250,000, $625/month.

Would a person pulling down $20,000 a month, even be aware that they didn’t have an extra $600 to spend each month?

Makes one wonder what these people in Congress can be seriously and honestly thinking about: pride, bullheadedness, or concern that their big donors will not fund their next trip to Washington.


Richard Heckler 2 years, 9 months ago

What Fiscal Cliff? Ben Bernanke came up with "Fiscal Cliff' nonsense.

Much information .... YOU decide.

--- Killing Social Security Insurance Is Not An Option.

--- Killing Medicare Insurance is simply not an option.

President Obama and the USA Congress what are you going to do? This country cannot wait another fours years for the republican party to cooperate. The democratic party cannot wait another fours years for republicans to stop being obstacles to new USA industry that cannot be outsourced and millions of new jobs that cannot be outsourced.

Think jobs jobs jobs and new economic growth are one. Of course citizens need a minimum of 17.50 per hour. At $33,000 a year that isn't much money.

BTW if tax breaks created new USA employment and if republicans would stop killing our economy with their home loan scams this conversation likely would not be taking place.

Pal 2 years, 9 months ago

What right do you have to other peoples hard earned money?

You and your mentality is why the country has no money.

voevoda 2 years, 9 months ago

People who are the beneficiaries of public services, such as police protection, health and safety inspections, education, public works, scientific research, etc. etc. etc., ought to be willing to pay for it. That includes you, Pal.

As for begrudging desperately poor people the pittance they receive from the government, remember the teachings of St. Paul:

"It is an obligation imposed not merely by fear of retribution, but by conscience. That is also why you pay taxes. The authorities are in God's service and it is to this they devote their energies. Discharge your obligations to everyone; pay tax and levy, reverence and respect to whom they are due." (Romans 13: 5-8)

"There is no question of relieving others at cost of hardship to yourselves; it is a question of equality. At the moment, your surplus meets their need, but one day your need may be met from their surplus. The aim is equality." (2 Corinthians 8: 13-14)

Pal 2 years, 9 months ago

I am surprised that your moral bullying didn't include the tragedy in Connecticut as Obama did today, trying to get his budget passed.

voevoda 2 years, 9 months ago

Oh yes--public services include treatment for the insane, except such services are dreadfully underfunded. There, Pal.

And is it "bullying," to cite Scripture? Most Christians would disagree, but perhaps you don't consider yourself to be a Christian. That's fine; we're a multi-religious country. However, I don't know of a single major religion that holds something different from what St. Paul wrote.

streetman 2 years, 9 months ago

Home loan scam? Here's the government scam that caused the thing: "everybody should/must own a home -- no matter what -- so we'll lower the standards for buying loans by our government-backed Fannie Mae and Freddie Mac, thus allowing the primary mortgage industry to make loans to anything that breaths! We'll get votes!" Did the private sector mess up? You bet -- because the government was stupid enough to buy their crap loans.

jhawkinsf 2 years, 9 months ago

Merrill - If this "fiscal cliff" crisis is made up, by Ben Bernanke as you suggest, then why is it that both President Obama and Speaker Boehner have fallen for the ruse?

Could the answer possibly be that Ben Bernanke, President Obama and Speaker Boehner are all better informer than you, and that the fiscal cliff is very real? Give that some thought between your cutting and pasting.

Pal 2 years, 9 months ago

Of course the elites Bernanke, Obama, Boehner, et. al. are using this crises to fear monger the masses.

Could it be possible there are too, too, many people like merrill that do not create wealth. Do not have any skin in the game....

Taking all the money from the 5% with money, would last a fortnight or two. Then the masses would have to rely on the merril's of the world for food, housing, asprin, and weed.

voevoda 2 years, 9 months ago

On what basis, Pal, do you assert that Merrill does not create wealth?

Lawrence Morgan 2 years, 9 months ago

Please tell us the basis on which you decide that merrill doesn't create wealth. This is an insult to her, and she should ask that you be removed from posting from now on. No one should be insulted like this on the internet.

streetman 2 years, 9 months ago

Sorry, pal -- stock dividends ARE taxed.

streetman 2 years, 9 months ago

Scary how people don't understand these basics. Of course dividends are "income" -- just like wages, interest, pensions, etc -- they are all separate lines on the tax form that are combined as "income" to be taxed the same -- look at one of your old tax forms -- assuming you are one of the 50 % who pay taxes.

chootspa 2 years, 9 months ago

Scary how you like to round down numbers like 53%. I really hope you're not an accountant. Speaking of which, I'll ask my accountant to clarify the nuance of investment income and differentiate between mutual funds, REIs, and stock dividends. Because clearly, those are "basics." How silly of me to get them confused.

voevoda 2 years, 9 months ago

Virtually everyone in this country pays taxes, streetman. They pay sales taxes, gasoline taxes, property taxes (either directly or part of their rent). The people who don't pay Federal income taxes are those whose income is a) too small to provide them with a living wage; or b) too well sheltered to be taxable. I don't see how anyone can despise the first group--they are so desperately poor. As for the second group, you've got a legitimate complaint, and I'd like to see them pay up.

jafs 2 years, 9 months ago

They're taxed as "unearned" income.

chootspa 2 years, 9 months ago

Right. Thanks for the clarification. I've never purchased a dividend paying stock directly, so I had to look it up. Mutual fund dividends are different. You'd still ultimately pay less because you wouldn't have payroll deductions on it.

jafs 2 years, 9 months ago


As far as I know mutual fund dividends are also taxed that way.

You're right about the payroll deductions, and also they may be taxed at a different, lower rate as are capital gains - I'm not sure.

chootspa 2 years, 9 months ago

When I looked it up, apparently mutual funds are different than ordinary stock dividends, so they qualify for the capital gains rate. Or at least that's how I understood it. See? This is why I have an accountant.

Cant_have_it_both_ways 2 years, 9 months ago

The mindset continues of taking from the producers and giving to the non producers.

chootspa 2 years, 9 months ago

So what exactly is produced by a pork belly future? Hint: it's not bacon.

chootspa 2 years, 9 months ago

Or a hedge fund? Hint: it's not hedges.

rwwilly 2 years, 9 months ago

There must be at least a million ways to justify increasing the tax load on the well to do..."wealthy", "rich", whatever. I ask the same question to all proponents of increasing taxes on the wealthy, "When is enough, enough? The top 20% of reporting households pay approximately 90% of all income taxes. What percentage SHOULD the top 20% pay that would make you happy?" I have yet to get an answer. Give me a number not an adjective.

jafs 2 years, 9 months ago

One idea is that they should pay equivalent to the amount of income they have proportionally.

So, if the top 20% have 90% of the income,...

voevoda 2 years, 9 months ago

Let's restore the Eisenhower rates until the deficit is eliminated and the unemployment rates are low, and then reduce tax rates across the board incrementally. What do you say rwwilly, to a Republican-style plan?

voevoda 2 years, 9 months ago

No, he is saying that paying taxes is an obligation we all have, and that those people who have more ought to pay more. As opposed to people who have almost nothing paying more, which is what the changes in Kansas tax laws have done.

SinoHawk 2 years, 9 months ago

You obviously have never looked at the US budget. If we had not gone to war under Bush, we would still have 1.3T deficits because of 1) runaway spending and 2) lack of entitlement reform.

chootspa 2 years, 9 months ago

Let's stop spending money on oil companies!

Pal 2 years, 9 months ago

Let's stop spending money on the 47%! They are contributing to the global warming hypothesis offering nothing, zip, zero, squat in return for destroying the planet!

At the very least, they could weave baskets or pull weeds in the park.

voevoda 2 years, 9 months ago

Yeah, make all those retired people who are living hand-to-mouth on Social Security weave baskets and pull weeds. And all those disabled people, too. That's the largest share of the 47%, Pal. They aren't "destroying the planet" any more--and probably less--than anyone else. And quite likely, they contribute to the quality of life of their families, friends, churches, and communities. Do you realize how ungchristian you sound, Pal, when you talk like this?

I am all in favor of "workfare" programs for the able-bodied unemployed. However, such programs are more expensive to run than just passing out welfare checks. Are you prepared to pay more, Pal, so that the able-bodied can have the dignity of labor and avoid the derision of narrow-minded people who call them worth "nothing, zip, zero, squat"?

headdoctor 2 years, 9 months ago

I doubt the several hundred thousand of the more wealthy including the six richest in the US that are part of the 47% will want to pull weeds and the thousands of retirees that are part of the 47% may not be able to.

Bottom line. You have no idea who makes up the 47%. The takers are actually the wealthy who don't want to pay more taxes but think it is perfectly fine for the lower and Middle class to do so. There are many wealthy people who don't produce anything but more money for their self yet take or use more than their share of everything else.

Larry Sturm 2 years, 9 months ago

why shouldn't the top 10% pay more in taxes they are reaping the profits of wars that we shouldn't be in if their weren't big profits in war there wouldn't be any war. If the middle class pays 90% of the taxes, guess who's paying the billions and billions of dollars for the wars.

Richard Heckler 2 years, 9 months ago

Congress Out Of Touch

Could it be that congress is wayyyy out of touch?

The Washington Post and ABC News survey found that Americans prefer to keep Medicare the way it is and oppose cuts in Medicaid. More than half say they are against small, across-the-board tax increases while calls to raise tax rates on the wealthiest Americans enjoyed solid support.

Seanator Sanders, a member of the Senate Budget Committee, has proposed legislation to impose a 5.4 percent surtax on millionaires that would raise up to $50 billion a year in new revenue. He also has called for eliminating tax breaks for oil and gas companies and loopholes that corporations use to shelter income overseas.

"While we have to move toward a balanced budget, we have to do it in a responsible way," Sanders said. "We need shared sacrifice, not just cuts that balance the budget on the backs of the sick, children, the poor and the elderly."

Richard Heckler 2 years, 9 months ago

Social Security privatization will raise the size of the government's deficit to nearly $300 billion per year for the next 20 years, almost tripling the size of the national debt.

There is no rush to change Social Security Insurance for the USA has 20 years or more to address the matter.

Social Security adds to the deficit = GOP nonsense. Reality: It's not just wrong—it's impossible! By law, Social Security's funds are separate from the budget, and it must pay its own way. That means that Social Security can't add one penny to the deficit.

Absolutely Save Social Security!!!

Social Security privatization will raise the size of the government's deficit to nearly $300 billion per year for the next 20 years, almost tripling the size of the national debt.

There is not the problem that politicians claim.

--- Not everyone collects Social Security

--- Until 1984, the trust fund was "pay-as-you-go," meaning current benefits were paid using current tax revenues. In 1984, Congress raised payroll taxes to prepare for the retirement of the baby boom generation. As a result, the Social Security trust fund, which holds government bonds as assets, has been growing. When the baby boomers retire, these bonds will be sold to help pay their retirement benefits.

--- If the trust fund went to zero, Social Security would simply revert to pay-as-you-go. It would continue to pay benefits using (then-current) tax revenues, and in doing so, it would be able to cover about 70% of promised benefit levels

--- The system won't be bankrupt in any sense. On this point politicians are consciously misrepresenting the truth with the intent to deceive." That is what the dictionary defines as lying. -

Social Security is going broke is nonsense created by those posing as republicans.

Reality: There is no Social Security crisis. By 2023, Social Security will have a $4.6 trillion surplus (yes, trillion with a 'T'). It can pay out all scheduled benefits for the next quarter-century with no changes whatsoever.

After 2037, it'll still be able to pay out 75% of scheduled benefits—and again, that's without any changes. The program started preparing for the Baby Boomers' retirement decades ago. Anyone who insists Social Security is broke probably wants to break it themselves.

jafs 2 years, 9 months ago

The bonds aren't "assets", they're "liabilities".

The money that was collected for SS benefits for the Boomers has been "lent" to other parts of the government. When the bonds are sold, that means that the government will be borrowing that money from the people who buy them, and will have to pay it back plus interest.

So, instead of having a pile of money to pay benefits, we now will have to borrow that money, and pay it back with interest. We collected it from taxes, spent it on other things, and now will collect it some other way as well. That means we have to collect over twice as much as we originally had. It's quite insane really.

In just a few years, according to the SSA, revenue collected will start to lag behind benefits.

Richard Heckler 2 years, 9 months ago

--- This GOP ENTITLEMENT - TABOR is Coming by Grover Norquist = Grab Your Wallets!

--- This GOP ENTITLEMENT - Bailing out The Reagan/Bush Savings and Loan Heist aka home loan scandal sent the economy out the window costing taxpayers many many $$ trillions (Cost taxpayers $1.4 trillion), Plus millions of jobs, loss of retirement plans and loss of medical insurance.

--- This GOP ENTITLEMENT Bailing out the Bush/Cheney Home Loan Wall Street Bank Fraud cost consumers $ trillions, millions of jobs, loss of retirement plans and loss of medical insurance. Exactly like the Reagan/Bush home loan scam. Déjà vu can we say. Yep seems to be a pattern.

--- This GOP ENTITLEMENT - Bush/Cheney implied many financial institutions were at risk instead of only 3? One of the biggest lies perpetrated to American citizens. Where did this money go? Why were some banks forced to take bail out money?

--- RECKLESS GOP Tax cuts = THE GOP ENTITLEMENT program for the wealthy which do nothing to make an economy strong or produce jobs. Tax cuts are a tax increase to others in order to make up the loss in revenue = duped again. Bush Tax Cuts aka Entitlements.

--- This GOP ENTITLEMENT program for the wealthy is at the expense of the middle class = duped one more time.

--- In the end big debt and super duper bailouts HAVE BEEN the results which does not seem to bother Republicans, as long as they are in power.

Richard Heckler 2 years, 9 months ago

Not all wealthy people are against paying more into the cookie jar. Then again some wealthy families go the extra mile to keep people employed at decent wages because they understand that minimum wages will not support self sustainability.

The more money people make the more they spend ,save and/or invest = strong economy.

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