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  • The boomerang has come back

    Here.



    "The bottom 40 percent, on average, make a profit from the federal income tax, meaning they get more money in tax credits than they would otherwise owe in taxes. For those people, the government sends them a payment."
    Last edited by DUNBAR PLUMBING; 04-08-2010, 12:34 AM.
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  • #2
    Re: The boomerang has come back

    Originally posted by DUNBAR PLUMBING View Post
    Here.



    "The bottom 40 percent, on average, make a profit from the federal income tax, meaning they get more money in tax credits than they would otherwise owe in taxes. For those people, the government sends them a payment."
    I know a person that is in exactly this boat. He has a small business that he has been growing. Income is small, so the Earned Income Credit offsets ALL their taxes and he's literally gotten a check from the IRS for the past 5 years. He doesn't really need the handout. Still, the money comes and so he takes it. It's not really new - the credits (EIC for sure - I suspect there are others) have been around for years.

    My friend will pay tax this year (business is taking off despite the economy). But I believe many, many others are dis-incentivized by government handouts and milk these things to the hilt.

    I don't blame the recipients. I blame the liberal-socialist numbskulls in DC.

    Comment


    • #3
      Re: The boomerang has come back

      For four of the last five years wasn't it the conservative numbskulls that were in charge?

      Isn't it easy to blame the opposing party rather than admit that it is ALL of the folks in DC that are at fault. It is also the voters fault because we keep returning these bozo's year after year. (my guy is OK as he brings a lot of "pork" to my district).

      VOTE THEM ALL OUT IN THE NEXT THREE ELECTIONS

      First election - all of the house members and 1/3 of the senate

      Second election - the second third of the senate

      Third election - the last third of the senate (and maybe the entire house again in order to keep them on their toes.

      The above will also keep the lobbyists in disarray, they won't know who can be bought off for sure.

      Also, corporations now have the right to free speech and to spend lots of advertising money to influence the voters, but the last I checked, they still cannot vote. Maybe if we burned them in spite of their cash they might think twice.

      We can return our government to the people.

      Comment


      • #4
        Re: The boomerang has come back

        Originally posted by billmoy View Post
        We can return our government to the people.
        never vote for an incumbent

        steve
        In the never ending struggle to keep the water flowing.... The Poo Poo Cowboy rides again!!!

        Comment


        • #5
          Re: The boomerang has come back

          Originally posted by stxrus View Post
          never vote for an incumbent

          steve
          Since my first opportunity to vote, back in the 60's, my number 1 policy is, "When in Doubt, Vote Them OUT!"

          The problem of course is that far too many people vote for the "party" and not for the country; and along with that goes a tremendous lack of knowledge about what their party is doing and who exactly is to blame for what. This is especially true with incumbants.

          ********

          This "story" leaves an awful lot of information out of the picture. It's primary objective seems to be to let the reader know that the "bottom 40% get a check back from the government".... in other words, all of us in the bottom 40% are not only free loaders, but are also ripping off those hard working people who are breaking their a$$ supporting the rest of us.

          I've worked my butt off since I was 14 years old, and I certainly have always been in the bottom 40% and starting with my first W2/1099 at the ripe old age of 17, I've ALWAYS paid taxes and have up until my retirement in 2003; and I have never got a refund that came anywhere close to even 10% of what I've had to pay!

          Now that I'm "retired", my total yearly income is definitely small enough to NOT be subject to either Federal or State Income Tax. But I can assure you that I do not receive any refund on the difference between what I earn and what the bottom income level is for taxable income. Likewise, all the tax incentives, breaks, write-offs, and credits that there might be, does me, and millions like me, absolutely NO good whatsoever... we simply don't make enough to be counted or deducted or credited!!!!!

          Take a look at the "bottom 40%" and then subtract those whose income are so low as to not be even qualify as having income worth taxing... that probably takes away a good percentage of those numbers.

          So really, it might well be that the real bottom 10 or 15% don't make enough to qualify at all. Then there's the single workers or the families with only one or two children, or the families that don't own a home, or have and income or spend enough to qualify for certain tax breaks. That maybe leaves a remaining 5 or 10% who are able to take advantage of the tax breaks... and of those, who is it really that is able to take advantage of the tax breaks?

          The sad fact is that since the mid-80's the middle class (that's the class that has historically paid the lion's share of U.S. taxes) has shrunken drastically. The low-income (you may read that, "poor") class has grown and the rich have continueally increased their income, and the margin of their income represents above the middle class, has continually widened.

          Likewise, in order to take advantage of most of the tax deductions, write-off's, and other tax breaks... one has to do some considerable spending or be in a position to "justify" or write-off certain normal expenses that the average working class simply doesn't qualify for. So while the business executive can write off his automobile, the summer house, that vacation to the Bahama's or even a good hunk of his daily spending habits, like lunch,... you and I most likely not in a position to do so... we're simply left to be concerned about the affordability of whether we can afford to fill up the gas tank this week or maybe go out to dinner with the wife.

          Despite the low income of us bottom-feeders who don't pay income taxk, we still have to pay taxes on that gasoline, the food, the clothing, the car, etc.; and, if we are so privileged to have been able to afford a home, we pay real estate to the city and the county as well as school taxes.... all of which might be "deductable" to some degree, if only we made enough money to be taxable!

          We "lower 40%" can only dream of the times when we actually used to be able to earn enough money to be able to perhaps hope for a nice refund some time after April 15th. But, that is by no means a "hand-out" as some of you have termed. There is NO LAW that says that anybody has to pay, or morally should pay, one more dime than the tax codes define on personal income. Personal income, unlike that of a business (and that cloak that the rich are able to easily afford) does not provide for "write-offs" for driving your car to work, or even the car itself. It does not allow you to write off your lunch or your vacation, or that shopping trip to Europe as a "business expense". It does not allow you to write off your study and it's lights, heat, or real estate tax % as a "home office". There are so many tax breaks for business, and even more for for big business!

          So while we "bottom 40%" don't necessarily pay income taxes, we also don't get to write off any of our other tax expenses, nor do we get any relief on our meager little $20K each year to keep the health insurance company, the pharmaceuticals and the rest of the health industry from sucking the remaining pennies out of us!

          Meanwhile the CEO's and the Bankers' are getting grants, tax breaks, and $Billions to take their business and their pleasures "off-shore".

          In other words, if you really want to believe this junk story, that's what makes America the country she is today. People are too easily swayed to focus on someone else to blame.

          So, when in doubt vote them out... but you really need to do your homework! Likewise, when you see an article like this, you really need to think about it and ask yourself "why?" and maybe you'll find that there's a lot of "holes" that don't make sense and maybe the objective is simply to divert your focus away from where the problem really lays.

          CWS

          Comment


          • #6
            Re: The boomerang has come back

            Originally posted by billmoy View Post
            For four of the last five years wasn't it the conservative numbskulls that were in charge?

            Isn't it easy to blame the opposing party rather than admit that it is ALL of the folks in DC that are at fault. It is also the voters fault because we keep returning these bozo's year after year. (my guy is OK as he brings a lot of "pork" to my district).

            VOTE THEM ALL OUT IN THE NEXT THREE ELECTIONS

            First election - all of the house members and 1/3 of the senate

            Second election - the second third of the senate

            Third election - the last third of the senate (and maybe the entire house again in order to keep them on their toes.

            The above will also keep the lobbyists in disarray, they won't know who can be bought off for sure.

            Also, corporations now have the right to free speech and to spend lots of advertising money to influence the voters, but the last I checked, they still cannot vote. Maybe if we burned them in spite of their cash they might think twice.

            We can return our government to the people.
            Bill, you won't find a bigger critic of the Bush administration than me. But my comment you refer to is with repect to entitlements, and that is a liberal invention that didn't happen over the last few years. I fully agree that both parties are jointly responsible for the problems in our Country, and have been expressing that sentiment profusely. But I think it's important to ascribe the right effect to the right culprits. For example, entitlements belong to the liberals, trade policy (most, not all), iresponsible deregulation and oil wars belong to the Repubs.

            Liberalism is a philosophy, not a party. Over the years, the definitions of liberal and conservative have morphed and today the only real difference seems to be the target -- who gets your money. There was a time when 'conservatism' meant 'small government' first and foremost -- I think those days are gone, despite the political rhetoric. There is no such thing as a conservative anymore

            I fully agree with voting out incumbents. In fact, I've advocated it before. But I also think it's important to understand whose doing what to whom. Simply calling for voting out incumbents in mass is great... but it's (realistically) unlikely and even if it did happen, it's only half the battle. The money interests will still exert their influence, whether it's the old guys or a new crop. The Federal Reserve and their monetary policy is a great example, and is essentially unchanged from Bush to Obama. It's a bipartisan disaster.

            Disrupting the status quo is very important but what is even more important is properly understanding the real effect of these disastrous policies and giveaway programs - whether they are to the banks through bailouts and *artificial* low interest rates, or to the public through social programs and entitlements. Entitlements as a group are by far the the largest single manadatory expenditure of the Fed Gov't. The public likes giveaway programs, and seems to believe that the Government has an infinite supply of money. Getting past that misconception is even more important than which particular puppets sit in the seats on Capitol Hill.

            Comment


            • #7
              Re: The boomerang has come back

              The data in the article is directly from the IRS, they publish statistics every year.

              The tax credits are real. Not everyone qualifies but many, many people do. The Earned Income Credit alone, which pays out a max benefit of $5657 for 2009, will cost the Federal Government about $36 Billion this year. Interesting, since the income tax is supposed to collect revenue.

              You don't have to have tax liability to claim many of the credits available. For example, the IRS estimates that 15-25% of potentially eligible EIC recipients don't claim the credit - many because they don't file at all, but would get a pleasant surprise if they did!

              Yes, the article actually doesn't tell the complete story though. Take a look at this release from the Joint Economic Committee relative to tax year 2006: http://www.house.gov/jec/news/2008/July/pr110-45.pdf . The data more or less closely supports the AP story Dunbar cited, but goes further in pointing out who is REALLY paying Federal income tax. In synopsis,

              The top 1% of AGI ($389k and above) pay 40% of all Federal taxes collected. They account for 22% of the AGI. You may not like that 22% (get over it) but the fact is that the big income people are very clearly paying their share.

              The next 4% of AGI ($153k to $389k) paid an additional 20% of all Fed taxes collected.

              This means that the top 5% of filers pay 60% of Federal income tax collected.

              The next 45% of AGI - more or less the middle class - paid another 37%. Which despite the noise about the middle class paying a disproportionate high amount of tax, doesn't seem out of line to me.

              The lowest 50% paid only 3%.

              We have a progressive tax here in the US. It's supposed to hit the deep pockets harder than the low earning group, and from the statistics (top 5% of filers paid 60% of income taxes), it seems to be doing that, no? So what's the complaint, exactly?

              I don't see anyone lobbying to increase taxes on the lower 50%, do you? Fact is, you never will - even though they SHOULD be paying more than 3 lousy percent, IMO. But, the bottom 50% control half the votes, so no politician will ever target them. The largest widespread tax credit program, the aforementioned Earned Income Credit, has been around since 1975 (Jimmy Carter) and has been increased by EVERY ADMINISTRATION SINCE - Demo and Repub alike.

              Now, where exactly are the FACTS that show that the big earners are skating away without paying??? I'm sure there are individual cases but as a group it's clear that they are paying their share and then some.

              In light of these numbers, I do fully agree that, "people are too easily swayed to focus on someone else to blame."

              Comment


              • #8
                Re: The boomerang has come back

                Originally posted by Andy_M View Post
                The data in the article is directly from the IRS, they publish statistics every year.

                The tax credits are real. Not everyone qualifies but many, many people do. The Earned Income Credit alone, which pays out a max benefit of $5657 for 2009, will cost the Federal Government about $36 Billion this year. Interesting, since the income tax is supposed to collect revenue.

                You don't have to have tax liability to claim many of the credits available. For example, the IRS estimates that 15-25% of potentially eligible EIC recipients don't claim the credit - many because they don't file at all, but would get a pleasant surprise if they did!

                Yes, the article actually doesn't tell the complete story though. Take a look at this release from the Joint Economic Committee relative to tax year 2006: http://www.house.gov/jec/news/2008/July/pr110-45.pdf . The data more or less closely supports the AP story Dunbar cited, but goes further in pointing out who is REALLY paying Federal income tax. In synopsis,

                The top 1% of AGI ($389k and above) pay 40% of all Federal taxes collected. They account for 22% of the AGI. You may not like that 22% (get over it) but the fact is that the big income people are very clearly paying their share.

                The next 4% of AGI ($153k to $389k) paid an additional 20% of all Fed taxes collected.

                This means that the top 5% of filers pay 60% of Federal income tax collected.

                The next 45% of AGI - more or less the middle class - paid another 37%. Which despite the noise about the middle class paying a disproportionate high amount of tax, doesn't seem out of line to me.

                The lowest 50% paid only 3%.

                We have a progressive tax here in the US. It's supposed to hit the deep pockets harder than the low earning group, and from the statistics (top 5% of filers paid 60% of income taxes), it seems to be doing that, no? So what's the complaint, exactly?

                I don't see anyone lobbying to increase taxes on the lower 50%, do you? Fact is, you never will - even though they SHOULD be paying more than 3 lousy percent, IMO. But, the bottom 50% control half the votes, so no politician will ever target them. The largest widespread tax credit program, the aforementioned Earned Income Credit, has been around since 1975 (Jimmy Carter) and has been increased by EVERY ADMINISTRATION SINCE - Demo and Repub alike.

                Now, where exactly are the FACTS that show that the big earners are skating away without paying??? I'm sure there are individual cases but as a group it's clear that they are paying their share and then some.

                In light of these numbers, I do fully agree that, "people are too easily swayed to focus on someone else to blame."
                Well, it CAN be argued that the amount of taxes being paid, are really just the amounts those people are caught with. There is a five story building in Aruba where it's address is listed with over ten thousand US companies as their place of business. This was something I remember watching on C-span, where a US representative held up a poster to the floor over matters of tax evasion.

                Comment


                • #9
                  Re: The boomerang has come back

                  Originally posted by tailgunner View Post
                  Well, it CAN be argued that the amount of taxes being paid, are really just the amounts those people are caught with. There is a five story building in Aruba where it's address is listed with over ten thousand US companies as their place of business. This was something I remember watching on C-span, where a US representative held up a poster to the floor over matters of tax evasion.
                  When it comes to tax evasion, why aren't we enforcing the tax laws already on the books? (I think there were at least 10 members of the current executive branch that finally 'fessed up and paid their's when appointed to office.)

                  And as for taxing businesses, they just buck it on down to the consumer, so the individual still gets stuck with the bill. When the supreme court said a business was considered an "Individual"(for other reasons, mainly political contributions) the tax basis and logic went in the toilet.

                  The other side of this coin is that this is only talking about income taxes. What about sales tax, death tax, inheritance tax, highway use tax (license plates, etc), real estate tax, personal property tax, etc.

                  Bottom line: Government is spending way more than our ability to support while legislating more restrictions that make it even more difficult to earn more, which in turn reduces the government's take. Things will change soon, because the current spending will soon run us out of credit, resources, and capabilities. Spending money you don't have and can't earn is illegal for any individual or business. Why is it not illegal for the government?

                  Go
                  Last edited by Gofor; 04-10-2010, 11:19 PM.
                  Practicing at practical wood working

                  Comment


                  • #10
                    Re: The boomerang has come back

                    Originally posted by tailgunner View Post
                    Well, it CAN be argued that the amount of taxes being paid, are really just the amounts those people are caught with. There is a five story building in Aruba where it's address is listed with over ten thousand US companies as their place of business. This was something I remember watching on C-span, where a US representative held up a poster to the floor over matters of tax evasion.
                    Yup this happens. It would probably help if all the evasion and legal skipping out of taxes was stopped, but would it solve the problem?

                    I don't think it's enough to even make much of a dent. The United States Federal Government has a big, big problem. Years of irresponsible spending made it a huge and possibly intractable.

                    Of $2.5T of federal expense, $1.5T is mandatory. Only $1T is discretionary, and that includes defense spending, which comes to about half of that. It's probably not wise to cut defense spending - spend it differently, perhaps, but that's another discussion.

                    I you don't touch defense, then you have about $500B of discretionary spending to play with. If you cut that by 50% then you've reduced the budget by $250 B. Not bad, but not close to enough. The Feds borrowed well over $1T to pay for 2009.

                    The government needs more money. A lot more. You can't really tax the public more, there is no sympathy for that nor will it help. The lower and middle classes don't really have it, and jacking up taxes on the uppermost payers will probably send the economy into an even worse skid than it's currently in.

                    Problem is, once again, that pesky balance of trade. Every dollar that is spent on a foreign product results in profits for the foreign maker and a paycheck for the foreign worker. None of which is taxed by the United States.

                    Cutting expenses is good, phasing out certain entitlements, fraud and abuse is good. But none of these things are going to solve the problem - and I don't believe any politician that says they are. The only solution is the creation of high paying jobs. Millions of high-paying jobs, that result in big taxes collected by the IRS.

                    I don't see the service economy accomplishing this... we need to get American industry back producing goods and creating decent paying jobs that generate taxes. The money needs to stay in the US and result in some taxes.

                    I've said it before. "Buy American" is not about patriotism, it is about economics.

                    Comment


                    • #11
                      Re: The boomerang has come back

                      Percentage of U.S. total income in 1976 that went to the top 1% of American households: 8.9.
                      · Percentage in 2007: 23.5.
                      · Only other year since 1913 that the top 1 percent’s share was that high: 1928.
                      · Combined net worth of the Forbes 400 wealthiest Americans in 2007: $1.5 trillion.
                      · Combined net worth of the poorest 50% of American households: $1.6 trillion.
                      · U.S. minimum wage, per hour: $7.25.
                      · Hourly pay of Chesapeake Energy CEO Aubrey McClendon, for an 80-hour week: $27,034.74.
                      · Average hourly wage in 1972, adjusted for inflation: $20.06.
                      · In 2008: $18.52.
                      Extreme Inequality

                      I think claiming the income disparity for the stock market crashes is inaccurate.

                      However, I think the economy and tax base is healthier when wealth is not consolidated to a relative few. Also, while the top percentile may pay 40% of the federal income taxes, they are generally taxed at a much lower rate than the middle class that does pay federal income tax. Capital gains are taxed at 15% while wages, SSI, Medicare and state income taxes consume well into 30% of their income. The 1% percentile also have access to tax shelters and deductions not available to 'paycheck-to-paycheck' wage earners.

                      The middle class is indeed a artificial, societal construct of the 20th century. The prosperity the middle class experienced in the forties, fifties and sixties is no less a coincidence than the prosperity experienced by the financial elite in the 1920's, 80's, 90's and 00's. Which era produced the greatest benefit for the greatest number of citizens?

                      The core of the argument put forth by the financial elite sympathizers is that we need to have this extreme concentration of wealth. That it is good for the country and the economy. That those of us not of the Ivy League legacy class, the wall street class, the entrepreneurial class should be grateful for the very existence of these classes.

                      It isn't surprising that we are becoming an oligarchy. What I find surprising is the meager offerings by which they secure support from the very class they mean to reduce to the point of irrelevance.
                      Last edited by SpiffPeters; 04-11-2010, 12:12 PM.

                      Comment


                      • #12
                        Re: The boomerang has come back

                        Originally posted by SpiffPeters View Post
                        Extreme inequality

                        I think claiming the income disparity for the stock market crashes is inaccurate.

                        However, I think the economy and tax base is healthier when wealth is not consolidated to a relative few. And lets not forget that while the top perctile may pay 40% of the federal income taxes, they are generally taxes at a much lower rate than the middle class that does pay federal income tax. They also have access to tax shelters and deductions not available to 'paycheck-to-paycheck' working stiffs.

                        The middle class is indeed a artificial, societal construct of the 20th century. The prosperity of the forties, fifties and sixties is no less a coincidence than the prosperity of the 1920's, the 80's and 00's was for the financial elite.

                        The core of the argument put forth by the financial elite sympathizers is that we need to have this extreme concentration of wealth. That it is good for the country and the economy. That those of us not of the Ivy League legacy class, the wall street class, the entrepreneurial class should be grateful for the very existence of these classes.

                        It isn't surprising that we are becoming an oligarchy. What I find surprising is the meager offerings by which they secure support from the very class they mean to reduce to the point of irrelevance.
                        What a bunch of baloney.

                        The whining about other people's success gets old. The bottom line when it comes to wealth is that some people have more than others because they are smarter, work harder, or make better decisions. Probably all three. You have exactly the same 24 hours every day that Bill Gates and Warren Buffett have. They don't spend it complaining about corporate taxes and oligarchies, it's all a waste of time. Moreover, I've never met a single successful person that complained about another's success. They are far more interested in asking lots of questions and learning from that person's success.

                        This isn't a socialist country. Your piece of the economic pie is dictated by what you do. If you want more money, figure out how to make more money.

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