Taxes: What Democrats Don't Want You To Know!

kbluck

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The Doctor said:
I'm not - my effective income tax rate is 23%, my marginal is 33% and I'm not rich, nor do I have beau coup priveledged deductions. I'm just a typical 45 yr. old white collar professional!
Are you including FICA/Medicare in that effective tax? I was speaking only of the personal income tax. I guess you are somewhere between $150k and $300k if you're in the 33% marginal bracket, and 23% total tax would be about right for somebody in the lower end of that range when you include all taxes, not just the income tax. About 3/5ths of that, like 15% is the average effective personal income tax in that range.

If you really are paying 23% of your gross income in personal income tax on an income in the low six figures, for some reason you're paying considerably more than average.

--- Kevin
 

Scully

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Tim McBride said:
Or we could just start cutting spending, and not worry about overhauling the system for awhile. Bush was very close to losing my vote over his spend now, pay later...
Hey Tim,

What do you think of the recently passed spending bills? I haven't really looked too closely, so I'm not sure how much of the talk is spin and how much is reality in terms of holding the line on spending.

BTW, I would totally support your approach too.

Take care,
Brian
 

purdyrc

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kbluck said:
I don't know your exact situation, so I can't say what it will do to you. I want to emphasize that every individual situation is different, and nothing I've said here may apply to specific individuals. I can only speak meaningfully about the collective impact on selected groups of millions of households.

If you're proposing the elimination of FICA and Medicare tax along with the existing income tax, then you will be cutting taxes for most American households greater than the median of about $45k and raising them on most households below that. However, you will also be cutting total revenues by about 25%, roughly doubling the current budget deficit. You'll need a flat tax rate in the 18-20% range to reach revenue-neutrality if you get rid of FICA/Medicare. That would raise overall taxes on about 70% of American households.

--- Kevin
I don't want to eliminte FICA and Medicare. I just want the total price tag (FICA, Medicare, and Income tax) to equal about 15% instead of the 18-23% it is now.

- Rick
 

The Doctor

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A modest mortgage, no kids, low property taxes - not much in the way of deductions. Most of my income is from salary and bonuses; it has taken me 20+ years to get where I am. The average taxpayer in my income range has a couple of kids in college, a higher mortgage payment, higher property taxes and pays a state income tax. They also tend to derive more of their income from long term investments. Taking the risk of holding a profitable investment for a year or more allows you to keep 85% vs. 67% of that gain - assuming the gain is still there.

Those 'average' taxpayers in my bracket deserve the tax breaks that they get.
 

The Doctor

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purdyrc said:
I don't want to eliminte FICA and Medicare. I just want the total price tag (FICA, Medicare, and Income tax) to equal about 15% instead of the 18-23% it is now.

- Rick
We need to completely sever FICA and Medicare from the overall package. These are specific retirment and insurance programs - the revenues and outlays need to be isolated from the rest of the government. The first step in keeping them solvent is to prevent them from being pilfered.
 

kbluck

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purdyrc said:
I don't want to eliminte FICA and Medicare. I just want the total price tag (FICA, Medicare, and Income tax) to equal about 15% instead of the 18-23% it is now.
The total, including FICA/Medicare is already under 15% for more than half of American households. So, in effect, you are proposing a tax increase for at least half of all Americans, and the half that can least afford it to boot.

You are also proposing to double the deficit, unless you can come up with about $400 billion in spending cuts or additional revenues.

--- Kevin
 

purdyrc

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kbluck said:
The total, including FICA/Medicare is already under 15% for more than half of American households. So, in effect, you are proposing a tax increase for at least half of all Americans, and the half that can least afford it to boot.

You are also proposing to double the deficit, unless you can come up with about $400 billion in spending cuts or additional revenues.

--- Kevin
OK.

Every other Friday, I see that I have about 18-20% less than what my company paid me thanks to the Federal Government. This includes FICA, Medicare, and Fed tax. I want this total to be 15% or less.

- Rick
 

The Doctor

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Tim McBride said:
Weres the Republican party mantra of 'Less Government'........thats what I wonder.
Apart from Dr. No (Ron Paul), the biggest difference between Republicans and Democrats in this area, is that Republicans will apologize for expanding the size of the government. ;)
 
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