Dan
colvinbackshop wrote: OTOH, you folk that are complaining about the taxes you have to pay: OK than....Lets do a flat tax! So that EVERYBODY pays their fair share. And I do mean flat and flat for EVERYBODY!! It would save me a bunch, because I have nothing to write off. I can't even find any "loop-holes" that are in my favor! I just PAY!
OTOH, you folk that are complaining about the taxes you have to pay: OK than....Lets do a flat tax! So that EVERYBODY pays their fair share. And I do mean flat and flat for EVERYBODY!! It would save me a bunch, because I have nothing to write off. I can't even find any "loop-holes" that are in my favor! I just PAY!
I have a five-digit income and pay a flat tax because of the Alternative Minimum Tax. The reasons why there is a heavy burden on the honest, "middle class" (as well as the wealthy) are (1) about half of the on-the-table income earners pay little or no federal income tax and (2) there are tens of millions working "off the books" (tax cheats). I say, double the IRS and gain at least a ten/twenty-fold rate of return in tax revenues. My biggest expense is supporting my various governments: more than I spend in total on food, shelter, clothing, and transportation. Fortunately, I am able to cater to my distractions and my children's college educations (but not as much as I'd like) because I am frugal, particularly regarding housing (spending about half the average for my area).
Mark
First we all pay a flat tax on wages, called FICA. Except that the upper end is capped (uncapping it would "solve" the so-called social security "crisis"). Adding an additional flat tax in the range of 20% would be a heavy burden on the lower middle class and poor who are already struggling with the increasing prices. For them the sales tax is pretty close to a flat tax anyway. The real problem with the tax system is the loop holes and goofy breaks that the mostly rich enjoy. For example: Why is some unearned income like capital gains taxed at a lower rate than earned income?
Anyway mine goes to pay down my personal debt, even as it increases our collective debt.
Enjoy
Paul
ShadowNix wrote: gear-jammer wrote: We need to remember that this stimulus check is not money from the government. It is money that we have overpaid in taxes. It is great to hear about everyones new train wish lists. I made mine last month so I will be caught up for a while.SueSue, I have to agree with another poster about the rebate's coming from money the government borrowed from China. Wait till next year when our taxes definitely rise to pay just a part of the interest on our national debt. Mine is going in the savings account to save for the "certain" rise for heating bills next winter. Jim Let's clarify...money that the MIDDLE class have overpaid in taxes... if you are above or below a certain amount...NOTHING! I pay more than my fair share of taxes and I get BUTTKISS back! GRR...(not at you, but at the FEDS!!!)...oh well.... Brian
gear-jammer wrote: We need to remember that this stimulus check is not money from the government. It is money that we have overpaid in taxes. It is great to hear about everyones new train wish lists. I made mine last month so I will be caught up for a while.Sue
We need to remember that this stimulus check is not money from the government. It is money that we have overpaid in taxes.
It is great to hear about everyones new train wish lists. I made mine last month so I will be caught up for a while.
Sue
Sue, I have to agree with another poster about the rebate's coming from money the government borrowed from China. Wait till next year when our taxes definitely rise to pay just a part of the interest on our national debt. Mine is going in the savings account to save for the "certain" rise for heating bills next winter. Jim
Let's clarify...money that the MIDDLE class have overpaid in taxes... if you are above or below a certain amount...NOTHING! I pay more than my fair share of taxes and I get BUTTKISS back! GRR...(not at you, but at the FEDS!!!)...oh well....
Brian
Seeing as I'm 13 I won't be getting a check...
Darnit, I could use that new BLI GS-4....
IRONROOSTER wrote: Why is some unearned income like capital gains taxed at a lower rate than earned income?Paul
Why is some unearned income like capital gains taxed at a lower rate than earned income?
Why are there taxes on imaginary gains caused by inflation such as when (1) paying taxes on the 3% interest earned on a bank account when the purchasing power of the beginning balance decreased by 4% and (2) paying taxes on a long-term investment that might have increased in nominal value by 100% when the purchasing power of the investment may have decreased 50%? If one holds assets for an extended time, the actual tax rate on capital gains are very high (up to and exceeding 100%), and can result in taxes for economic losses. If one thinks this is OK, then why wouldn't one be against the big tax break home owners get because they get an exemption for the increase in their homes' appreciation? And why do the government's tax revenues increase when the capital gains tax is reduced, and decrease when the tax rate is increased? Jack Kemp has been correct for decades: financial investments should be indexed for inflation.
I would APPLAUD a flat tax... it evens the playing field, in my humble opinion. Having a tax rate above 33% in some brackets is crazy for us middle to middle upper class. I mean, 39.6% of say 10 million is nothing for those people, but 39.6% of about $300k is NUTS (as far as financial true buying power impact....)... just my humble opinion, but there it is! Not a rant or whine, just a discourse....
Hoople wrote:Seeing as I'm 13 I won't be getting a check...
You mean we don't get them? I thought we got them, just less..... Oh well.
While a flat tax is a good idea, you will never see it.
Reason one: Congress has never written a law that did not contain an exception. As soon as you start making exceptions it is no longer a flat tax.
Reason two: The reason the tax laws are so convoluted that even the IRS doesn't really know how much you owe is that the tax laws are used to control behavior more than they are used to raise revenue.
Taxes on things to discourage their use. Tax breaks on things to ecourage their use. Tax "stimulus checks" used to buy votes. Etc.
Dave
Lackawanna Route of the Phoebe Snow
Phoebe,
You are SOOO right about taxes being used to "buy" votes and loopholes.... think about every major political battle/election....taxes (either increasing or decreasing) are always used to get special interest groups.... imagine saying, well, I think I will increase taxes to, well, everyone by going from 19 to 21 %!!! LOL.... of course, you could be REALLY popular to say the opposite, but it would cause a HUGE decrease in revenue... but I digress... good points, Phoebe.
ShadowNix wrote: I would APPLAUD a flat tax... it evens the playing field, in my humble opinion. Having a tax rate above 33% in some brackets is crazy for us middle to middle upper class. I mean, 39.6% of say 10 million is nothing for those people, but 39.6% of about $300k is NUTS (as far as financial true buying power impact....)... just my humble opinion, but there it is! Not a rant or whine, just a discourse....Brian
Don't move to Sweden! The minimum tax where I live is 34%. That is where it starts, VAT is 25% on most regular items. Gas and alcohol have an even higher tax. My father pays a lot more then 50% tax. About ten years ago when I was still young when I worked a lot of overtime my tax was 54% and I made in those days about 1200$ in my basic monthly salary.
I'm all for flat tax!
Magnus
Yeah, Magnus, but for your flat tax you get things that actually work...
For example, great public transit (TRAINS EVEN!!!), nationalized healthcare (I know there are those that say it hasn't worked in Sweden, but I digress...again....), a working social security system (Notional Defined Contribution), must I go on? Here in the US here's what we get:
Ailing transport systems (highways, rails.... BROKEN and require EXTRA taxes tolls or referrendums in most states to pay for...)
Medical System, that while the best in the world, is somewhat BROKEN as well!
Broken Social Security System that will likely NOT exist when I retire, despite my likely having paid over $300,000 into it by the time I retire!
This being said, I am a huge patriot and don't mean to be negative....we have a great country...just lots of work to do in the near and coming future!
ShadowNix wrote: Yeah, Magnus, but for your flat tax you get things that actually work...For example, great public transit (TRAINS EVEN!!!), nationalized healthcare (I know there are those that say it hasn't worked in Sweden, but I digress...again....), a working social security system (Notional Defined Contribution), must I go on? Here in the US here's what we get:Ailing transport systems (highways, rails.... BROKEN and require EXTRA taxes tolls or referrendums in most states to pay for...)Medical System, that while the best in the world, is somewhat BROKEN as well!Broken Social Security System that will likely NOT exist when I retire, despite my likely having paid over $300,000 into it by the time I retire!This being said, I am a huge patriot and don't mean to be negative....we have a great country...just lots of work to do in the near and coming future!Brian
We do not have flat tax. We just have a very high starting tax rate and then it quickly gets real ugly!
About health care. We have a lot of problems with it. We have to wait along time to get aid and things are not as rosy as movies as "sicko" portrays it. The roads where I live is scandalous with huge potholes on the main roads in my area. Our public transit system is OK in some parts of the country. Where I live, we got something like four buses a day.
So for me atleast I can not see the benefits. Sure, their is a general welfare and the average Swede have a decent life. The poorest swede does OK to, but the average swede is way behind the average American.
But maybe we are getting to of topic. I don't want to have this discussion locked so I'm walking away from it now.
Ahhh, thanks for clarifying that Magnus....
I thought you had a flat tax... LOL... again, thanks for the lively discussion....
Magnus Thanks for sharing your views about taxes, etc in Sweden. I'm afraid too many people everywhere have a notion that "the grass is greener on the other side." I'm really glad we have the kind of health care we have here and would not want the government to mess it up.
Some have commented on flat tax and taxation in general. I am thinking of how that impacts model railroading. I believe model train manufacturing moved overseas due partly ( but siginficantly) to high taxes. Higher taxes on employers simply causes jobs to go elsewhere. I can see how a sales tax would be best in that regard. Income taxes ultimately become part of manufacturing costs for domestic products. Sales taxes would be applicable to both imported goods and domestic goods.
GARRY
HEARTLAND DIVISION, CB&Q RR
EVERYWHERE LOST; WE HUSTLE OUR CABOOSE FOR YOU
Unless you're one of the 47 million who has no insurance. Or one of the millions more with poor insurance.
While I have no idea what Sweden's health care system is like, ours is in serious need of replacement. One of the really advanced "features" of our "system" is the way the uninsured get billed 2.5 to 10 times as much as those with insurance.
Magnus and ShadowNix: Thanks for the "give & take" on the taxation situation. Very interesting to hear! For sure!
I will chime in with an opinion on the health care situation though....
We (the US) are the only civilized / industrial nation that doesn't take care of it populous! I have all sort of relation across the Northern border in Canada....some complain the system doesn't work (most in regard to having to wait for certain things / procedures) and others that feel it's a good system in regard to providing great care when it's truly needed.
The problem here (again in the US) is that unless your employer helps with the payment of the premium, a person can't afford to buy health insurance.
I will use my own situation as an example: I am a twenty year employee of a school district and do not qualify for the "group insurance". This, by the way is extremely convoluted between the classes of employees. But...At this point in time in my employ, I can have the privilege to work the entire month, take those earnings, add about $100 (out of empty pocket by this time) to those total earnings and be able to pay the health care perineum. Just to pay for the health care would leave me in the hole, month after month with no real income! Thus, I have NO health insurance! But I can pay for gas, electric, food and such! Something is MAJOR wrong here!
Soooo....In closing and again stepping down from my soapbox...I would much rather "wait" for something than have nothing!
colvinbackshop wrote: Magnus and ShadowNix: Thanks for the "give & take" on the taxation situation. Very interesting to hear! For sure!I will chime in with an opinion on the health care situation though....We (the US) are the only civilized / industrial nation that doesn't take care of it populous! I have all sort of relation across the Northern border in Canada....some complain the system doesn't work (most in regard to having to wait for certain things / procedures) and others that feel it's a good system in regard to providing great care when it's truly needed. The problem here (again in the US) is that unless your employer helps with the payment of the premium, a person can't afford to buy health insurance. I will use my own situation as an example: I am a twenty year employee of a school district and do not qualify for the "group insurance". This, by the way is extremely convoluted between the classes of employees. But...At this point in time in my employ, I can have the privilege to work the entire month, take those earnings, add about $100 (out of empty pocket by this time) to those total earnings and be able to pay the health care perineum. Just to pay for the health care would leave me in the hole, month after month with no real income! Thus, I have NO health insurance! But I can pay for gas, electric, food and such! Something is MAJOR wrong here!Soooo....In closing and again stepping down from my soapbox...I would much rather "wait" for something than have nothing!
Thanks for you input as well. It is interesting to read about the different systems. I'm quite sure that neither system, your or ours are perfect.
I will give you an example about our system, now of course anecdotal evidence is hardly proof of everything but still, it's an example from my private life which might make people think.
My wife asked for treatment for a disease in the spring of 2000. She received nothing, she had to wait for about 18 months before she got at a time at the doctor to be evaluated. That was rushed since we really begged for it when she was pregnant and that made her jump the line. But that was just a 30 minute evaluation to see if she needed health care. She qualified. Then jump forward a long while, until this spring, about two months ago. My wife's parents finally said to heck with it and paid for the treatment at a private doctor. About a month later, she finally got into the "universal health care" system.
Now, of course this wasn't for a broken leg or something but something a bit more special, but absolutely nothing fancy. So is 8 years of waiting acceptable? I don't think so, especially given the taxes we are paying. A system the forces both people in a relationship to work 100% just to be able to afford a minimum.
One should ad that our system is also being discussed if it works or not. We also have the discussions about the retirement systems not going to be able to hold on to the decent level it is today and that perhaps retirements will have to be postponed until we are 70(we retire at 65 now)
So in conclusion, both systems have problems, neither is perfect. If would be free to choose I would choose your system despite it's limitations. Or I would go even further then that and really let people choose for them self.
PS I know we are not suppose to discussing politics but I really hope we are not going to far. Seeing how we are all civil I do hope that we are allowed to keep this topic going. I love these kind of issues.
Well mine will go back into savings to be trotted out again when Athearn Releases the NS Highhood SD40-2 , and Atlas releases the NS and SOU MP-15's both due in September. I have two of each pre-ordered....that should finish up my motive power list.
Sue - the stimulus check is not a refund of overpaid taxes. The stimulus check is actually considered an advance of your 2008 refund.
When you look at your 2008 1040, which has not been drafted yet, there will be a calculation needed on your 2008 tax return that will calculate your rebate based on your 2008 income and compare it to the rebate you received. If there is a difference, if it is in your favor the additional amount will go as a credit on 2008's 1040, if it is negative, then the difference is not required to be repaid. the Gov't is merely using your 2007 income as an estimate of your 2008 income to base the rebate on. But your 2008 rebate will be reduced by that amount. Uncle Sam is just giving you a portion of it early.
The initial effect on the budget is to increase the deficit by an estimated 116.7 billion dollars in 2008 and 2009 fiscal years. This is based on a estimate prepared by the Joint Committee on Taxation. I don't believe this estimate includes the cost of processing the checks, mailing those nice letters to tell you you're going to get a rebate (approx $42 mil) and other costs.
http://www.house.gov/jct/x-17-08.pdf
For everybody that thinks the rebates are a great need to read the JCT review of previous economic stimulus programs and the macroeconomic effect of rebates. Follow the link beloew and read beginning on the last paragraph on page 26 of the report - Macroeconomic response to rebates. In a nutshell, there is very little effect on the economy from rebates - 0.1% increase in GDP; 0.2% increase in consumption; 0.1% increase in employment. Somoe studies found almost no benefit and possibly a negative effect in periods after the rebates are issued.
http://www.house.gov/jct/x-4-08r.pdf
Also consider that the increase in the deficit must be funded by additional borrowing by the government which has an adverse effect by increasing interest rates. The governemt's hope is that the increased spending will lead to increased tax revenues from increased income taxes. Unfortunately, the sheer difference in timing between the outflow and the inflow and the interest that must be paid is staggering to most people.
All in all, the through benefit on individual income tax rebates is minor to questionable. before you go out and make plans to spend your share of the $116.7 billion borrowed by Uncle Sam, consideer that somebody has to pay it back, with interest.
I don't think it will have to be repayed...Read this..
ShadowNix wrote:I am still bitter that I don't get the refund Man, I pay more than my fair share of taxes.... GRRRRR!!!
Texas Zepher wrote: ShadowNix wrote:I am still bitter that I don't get the refund Man, I pay more than my fair share of taxes.... GRRRRR!!! I'm not bitter but it does seem strange that the harder one works to get ahead the quicker they take it away. I just earned enough to go up the next tax bracket which in effect makes my net income lower than before! Had to write a 5 digit check just to pay taxes last year because I didn't adjust the deductible well enough. Oh yes, and that is just a little too much to get the stimulus check. grumble grumble Almost enough to make one want to quit and go on the welfare roles.
Isn't it funny how the IRS works? I mean it is so hard to get a straight answer on how many deductions to take it cracks me up? Then you get 5 digit BAM and that gets your attention!!! Jeesh! I was lucky, the first year I became an attending (physician) and my pay went up, I took the usual number of deductions (kids, married...yadda yadda)... an BAM, got a 5 digit REFUND.... go figure...made no sense to me.... Ah well, gotta give beauracrats something to do, eh? Heheheh have a good one guys... fun chewing the fat here... keeps my blood pressure down!
Am there, doing that: no rebate, lost almost all deductions and the "lower" capital gains tax rate (paying taxes on imaginary gains) and dividend (double) tax rates due to AMT, even though I have but a five-digit income. It is only going to get worse. While you and I already fund health care (in addition to food and housing) for the old and indigent, most people, according to the media, now seem to think it is a dandy idea that we also pay for their health care too.
JKTrains:
You need to have someone with better reading comprehension skills read those articles you are quoting for you.
Most of what you said is wrong, including your use of the term 2008 rebate in place of 2008 refund.
There is a ton of misinformation floating around in "send this to everyone you know" e-mails.
Phoebe Vet wrote: JKTrains:You need to have someone with better reading comprehension skills read those articles you are quoting for you.Most of what you said is wrong, including your use of the term 2008 rebate in place of 2008 refund.There is a ton of misinformation floating around in "send this to everyone you know" e-mails.
Phoebe, perhaps the JCT reports are little too technical for you. , the term rebate is the correct term. I have read the Act that was passed, the JCT technical explanation of the Act and the draft proposals. The check that everyone will receive is not a refund of overpaid taxes. The term used in the Act is a rebate. The Act provides for a credit against your 2008 taxes of $600 per eligible taxpayer and $300 for a qualifying child. There are certain phaseouts that may reduce the amount. The Act provides that instead of waiting until you file your 2008 income tax return to claim the credit, the credit will be received in the form of a check, to be issued shortly. The Treasury is using your 2007 income as an estimate of your 2008 income for determining your eligibility for the credit and therefore to receive a check. The Act states that there will be a reconciling step as part of preparing a 2008 tax return. It is anticipated that for most people the credit based on 2007 income and the actual credit using 2008 income will be the same. If there is a difference and the actual credit based on 2008 income is more than the rebate check issued based on 2007 income, you will get the difference on your 2008 return. If it turns out to be less then the excess does not have to be repaid. For example if based on 2007 income levels a part of the credit was phased out and you received less than the full amount in the form of a check, but your 2008 income declined such that no phase out applies you would claim the additional amount as a credit on your 2008 tax return. Since the idea is to stimulate the economy now, not in 12 months, a rebate, or advance payment of the credit, should be issed currently in the hopes that people will spend it and pump money into the economy. The limited benefit shown in studies is due to fact that not every dollar is spent, some people save it or us it to pay bills which does nothing to increase demand for goods.
"Rust, whats not to love?"