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 Possible changes in Tax Code 
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Modmin Dude
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Post Possible changes in Tax Code
With all this "Debt Crisis" crap going on, its gotten me to thinking about some possible ways to try to fix our current economic mess.

Here is the projected 2011 Income Tax Brackets, does anyone notice something a bit off or missing???
Quote:
2011 IRS Tax Brackets Prediction
Assuming only changes to the top two brackets but accounting for inflation over the 2010 tax brackets (2% for the 12 months through May 2010 according to the BLS), we get:

Tax Bracket Single Married Filing Jointly
10% Bracket $0 – $8,543 $0 – $17,085
15% Bracket $8,543 – $34,680 $17,085 – $69,360
25% Bracket $34,680 – $84,048 $69,360 – $140,046
28% Bracket $84,048 – $175,287 $140,046 – $213,435
35% Bracket $175,287 – $381,123 $213,435 – $381,123
39.6% Bracket $381,123+ $381,123+


Why in the hell is the top rate for those at $381,123 and ABOVE??? Does anyone else think there could be at least 1 or 2 more bracket ranges???? Why are those that make millions and billions (granted, very few of the population, but still covers Hollywood, various athletes, sports team owners and wall street types) lumped in with those that make much, much less. Granted I'm not in favor of our so-called progressive tax system, but if we're going to have one, shouldn't it account for all income brackets and treat said brackets as equal as possible?

Thoughts?

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July 27th, 2011, 11:59 am
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Post Re: Possible changes in Tax Code
The top 1% pays 54% of all taxes. The bottom 50% pay 0 in taxes. The remaining 49% pay 46%. Who's not paying their share?


July 27th, 2011, 12:04 pm
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Post Re: Possible changes in Tax Code
njroar wrote:
The top 1% pays 54% of all taxes. The bottom 50% pay 0 in taxes. The remaining 49% pay 46%. Who's not paying their share?

Nice rhetoric, how about actually answering the question posed?

Do you honestly think that those making MILLIONS and BILLIONS shouldn't pay more as a percentage of their income as someone making 300 THOUSAND???

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July 27th, 2011, 12:08 pm
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Post Re: Possible changes in Tax Code
TheRealWags wrote:
njroar wrote:
The top 1% pays 54% of all taxes. The bottom 50% pay 0 in taxes. The remaining 49% pay 46%. Who's not paying their share?

Nice rhetoric, how about actually answering the question posed?

Do you honestly think that those making MILLIONS and BILLIONS shouldn't pay more as a percentage of their income as someone making 300 THOUSAND???


Yes, why punish those that rise to the top? As a manager I try to reward those who work the hardest and produce the most, our tax code does the exact opposite. Seems anti-Capitalistic to me.

My first choice from a taxing perspective is to abolish income tax and instead use a national sales tax. You tax consumption and encourage savings and investment - something both our citizens and gov't should do. Does this work? Well some of the most economically successful states (like Texas), use this model.

If you are going to go with an income tax, strip it down and go with one rate. Say everyone pays 22%, no loopholes. Doesn't matter if you are working at McD's as a teenager or running Microsoft, you pay the same - what could be more fair afterall. Those at the top will still pay the majority of all taxes and their is no discouragement built into the system.

Think how much you could shrink the IRS by and how streamlined taxes would be. It would also be easier to adjust taxes based on expenses and react to debt.

A tiered system is rife with fraud, inconsistancies, paperwork, loopholes, etc. Simplify the tax code, please.

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July 27th, 2011, 12:24 pm
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Post Re: Possible changes in Tax Code
Pablo wrote:
TheRealWags wrote:
njroar wrote:
The top 1% pays 54% of all taxes. The bottom 50% pay 0 in taxes. The remaining 49% pay 46%. Who's not paying their share?

Nice rhetoric, how about actually answering the question posed?

Do you honestly think that those making MILLIONS and BILLIONS shouldn't pay more as a percentage of their income as someone making 300 THOUSAND???


Yes, why punish those that rise to the top? As a manager I try to reward those who work the hardest and produce the most, our tax code does the exact opposite. Seems anti-Capitalistic to me.

My first choice from a taxing perspective is to abolish income tax and instead use a national sales tax. You tax consumption and encourage savings and investment - something both our citizens and gov't should do. Does this work? Well some of the most economically successful states (like Texas), use this model.

If you are going to go with an income tax, strip it down and go with one rate. Say everyone pays 22%, no loopholes. Doesn't matter if you are working at McD's as a teenager or running Microsoft, you pay the same - what could be more fair afterall. Those at the top will still pay the majority of all taxes and their is no discouragement built into the system.

Think how much you could shrink the IRS by and how streamlined taxes would be. It would also be easier to adjust taxes based on expenses and react to debt.

A tiered system is rife with fraud, inconsistancies, paperwork, loopholes, etc. Simplify the tax code, please.

I agree with the national sales tax/consumption tax/flat tax/whatever you want to call it, however that is not what I'm trying to discuss here( as honestly, the chances of that type of system being implemented any time soon is very slim).
And, for the record, we do not have a Capitalistic system now, what we have is closer to Corporatocracy or Corporatism than Capitalism.

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July 27th, 2011, 12:36 pm
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Post Re: Possible changes in Tax Code
OK, then to answer the question you posed - no I don't think we should have more bracket ranges (but rather, just the opposite).

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July 27th, 2011, 12:44 pm
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Post Re: Possible changes in Tax Code
Pablo wrote:
OK, then to answer the question you posed - no I don't think we should have more bracket ranges (but rather, just the opposite).


Bingo!

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July 27th, 2011, 1:11 pm
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Post Re: Possible changes in Tax Code
Am I not asking these questions in way that's easy to understand? Or are people just jumping to conclusions? Or is it that the hyper-partisanship of DC has finally made its way to this forum???

Whatever the answer is, I have a feeling its time to move on..........

Peace brothers! I wish you all nothing but the best!

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July 27th, 2011, 1:18 pm
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Post Re: Possible changes in Tax Code
TheRealWags wrote:
Am I not asking these questions in way that's easy to understand? Or are people just jumping to conclusions? Or is it that the hyper-partisanship of DC has finally made its way to this forum???

Whatever the answer is, I have a feeling its time to move on..........

Peace brothers! I wish you all nothing but the best!


I'm having a hard time seeing Pablo's last comment as not answering your question. I don't know how making more brackets with higher % more equal. I would say it makes it less equal so we shouldn't do it. Even if the % for 400k is the same for $10 million. That is why it is a %, a % scales up so that if you make more you contribute more. I am not sure why you would need a higher % to make it equal if the % implementation takes care of that.

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July 27th, 2011, 1:54 pm
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Post Re: Possible changes in Tax Code
Quote:
Why in the hell is the top rate for those at $381,123 and ABOVE??? Does anyone else think there could be at least 1 or 2 more bracket ranges???? Why are those that make millions and billions (granted, very few of the population, but still covers Hollywood, various athletes, sports team owners and wall street types) lumped in with those that make much, much less. Granted I'm not in favor of our so-called progressive tax system, but if we're going to have one, shouldn't it account for all income brackets and treat said brackets as equal as possible?

Thoughts?


Does Pablo's or your answer/response reflect what is written above? Not IMO.

Perhaps I should have said "Discuss" instead of "Thoughts"..........

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July 27th, 2011, 1:59 pm
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Post Re: Possible changes in Tax Code
Adding more brackets penalizes people for success. Its the direct opposite of what the country was founded on.

We also don't have a revenue problem in this country, we have a spending problem. Again, its the opposite of the message being thrown in the rhetoric.

You could take everyone making $150k and above, and tax them 100% and it wouldn't fix anything. You could take 100% of every person in the country, and you'd pay off half of the debt. But of course you'd have no one able to buy food or pay rent. The only reason to tax more is to spend more.

I understand what you're trying to say, but in reality, when you start getting into "fair" sometimes the easiest solution gets overlooked. That 10% - 20% effectively doesn't even exist, because it all gets refunded. Even a minimal tax on those brackets would fix things over time.


July 27th, 2011, 2:16 pm
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Post Re: Possible changes in Tax Code
TheRealWags wrote:
Quote:
Why in the hell is the top rate for those at $381,123 and ABOVE??? Does anyone else think there could be at least 1 or 2 more bracket ranges???? Why are those that make millions and billions (granted, very few of the population, but still covers Hollywood, various athletes, sports team owners and wall street types) lumped in with those that make much, much less. Granted I'm not in favor of our so-called progressive tax system, but if we're going to have one, shouldn't it account for all income brackets and treat said brackets as equal as possible?

Thoughts?


Does Pablo's or your answer/response reflect what is written above? Not IMO.

Perhaps I should have said "Discuss" instead of "Thoughts"..........


Wags, sorry I didn't answer this question to your satisfaction. I actually can see where you are coming from on this since you basically are taking a progressive tax system for granted and there does seem to be a big difference between $300K and $10M per year.

But there are other factors involved as well, for example you brought up professional athletes they have to pay an extra income tax based upon which city/state they are playing in that night.

But as for the way your worded the question - "shouldn't it account for all income brackets and treat said brackets as equal as possible" - equality, IMO, is for all the income brackets to pay the same % in taxes.

Now if you want further discussion and want to that "equality" off the table and asert that the higher the income, the higher the % responsibility for taxes should be then I agree there needs to be more brackets. In this case, I would propose brackets based on income as it relates to the mass population.

So the top 10% pay 35% in taxes
top 5% pay 37.5%
top 1% pay 40%
top .05% pay 42%
top .01% pay 45%

The income levels fluctuate per year to account for economic changes. That would seem like a more sensible "progressive" system.

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July 27th, 2011, 2:26 pm
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Post Re: Possible changes in Tax Code
I guess I'm missing your intent:

With all this "Debt Crisis" crap going on, its gotten me to thinking about some possible ways to try to fix our current economic mess.

Here is the projected 2011 Income Tax Brackets, does anyone notice something a bit off or missing???

>>>>>> no

Why in the hell is the top rate for those at $381,123 and ABOVE???

>>>>>> Because it's a % and the more you make the more you pay so it scales up. There is no need to make higher brackets because a % is a scale. If someone makes $400k and another makes $800k, the person making $800 will pay twice as much as the person paying $400k (not taking into account the % for sub brackets).

Does anyone else think there could be at least 1 or 2 more bracket ranges????

>>>>>> No, that would mean you want the top bracket to pay a higher% than the lower brackets. We don't so the % takes care of having the ones with higher income pay more tax than those making less.

Why are those that make millions and billions (granted, very few of the population, but still covers Hollywood, various athletes, sports team owners and wall street types) lumped in with those that make much, much less.

>>>>>> Because at some point they have to make a X and above. Their is a progressive tax system in place, it allows the poor to not pay at all and the rich to pay more. They decided to stop the insanity at $381k... good.

Granted I'm not in favor of our so-called progressive tax system, but if we're going to have one, shouldn't it account for all income brackets and treat said brackets as equal as possible?

>>>>>> Where does it stop? Do you just make it an equation that goes to 100%?

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July 27th, 2011, 3:45 pm
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Post Re: Possible changes in Tax Code
The only fair system is ZERO loopholes and a simple "Everyone pays X% across the board on income" system. Right now, the top pays nothing due to loopholes, and the bottom 50% pays nothing due to refunds. If you really want fair, then it has to be flat.


July 27th, 2011, 4:03 pm
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Post Re: Possible changes in Tax Code
It sounds fair to have everyone pay an equal share.

But it isn't.

Why? Because the rich utilize the government's services more than the poor. Therefore, they should pay more.

The core objective of the government is protect property. And, if conservatives had their way, it'd probably be the only thing the government did. The more property you have then, the more you benefit by the government's existence. The rich, naturally, have more property.

Here's an easy example to illustrate the point: the fire department. Who benefits more from the fire department? The homeless or the rich?

Well, if you're living out of a cardboard box, you obviously don't benefit from the fire department. Fireman are not going to come put out your cardboard box fire. But if you're rich? You might own multiple houses, business buildings, etc. If any, or multiple of these burn down, you need the fire department.

That example can be extrapolated to nearly everything else. If you don't own any stocks, you don't benefit much from the SEC. If you don't own any intellectual property or patent rights, you don't benefit much from the DOJ making sure people don't violate your IP. Etc.

So, to answer your original question Wags, yes, there should be more brackets.

But, Pablo is in general right--the idea of an income tax is very stupid. We should pay for our government primarily through sales taxes. Where I strong disagree is the rates. Not everything should have a flat rate. Basic necessities like food, cheap clothing, cheap housing etc should not be subject to tax. Luxury items should have a higher tax rate. This makes the most sense and is the most "fair" IMO.


July 27th, 2011, 8:32 pm
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