Tax return is nearly $3000 LESS because I worked part-time last year!

[kgc07]

It gets complicated, because different types of income are treated differently.

Limiting the conversation strictly to earned income and income taxes, you're right - the more you make, the higher your effective rate. But when you start tossing the exclusion of unearned income from the social security system, the cap on social security contributions, the separate rate for capital gains, and all the other complexities of our system as a whole you find that the middle class does in fact pay higher rates than the very wealthy.

The rich don't pay the least by any means - that goes to those at the very bottom of the ladder who pay negative effective rates - but they do often pay a lower rate than the middle/upper middle classes who have a relatively high income that is all earned rather than derived from ownership and investments. Warren Buffett raised this point a few years back by pointing out that he pays a much lower effective tax rate than his secretary. [/QUTOE]

This is the point I was trying to make. Thanks, you added the explination and detail.

 

[DisneyMomma81]

We are collecting shoes for the people of Peru because they have no shoes. The people there work with rags wrapped around their feet.

Some of our congregation went to El Salvador to take Christmas boxes to the children there (shoe boxes with little toys, candy and such in them). The people in the villages live in "houses" that we would call a lean to for our livestock.

Our youth does go on trip here in the US. To places that need us the most. Rebuilding houses and churches after hurricanes, floods, etc.

Also, remember these are mission trips so there is more work intended than just the physical work of building houses. You have to have education to "teach them to fish".

We try to help as many as we can, people who are the neediest. We have holiday dinners, adopt families for Christmas, buy school supplies and school clothes. We aren't that large of a church, we can only do so much.

So... are the Peruvians happy? I'm sure most are, as long as you are healthy, safe & warm you'll be alright - people don't need what we consider the "comforts" of life to be happy. I'm somewhat envious of people who live like that, they don't deal with a lot of the crap we do ~ they don't have TVs, computers, cell phones etc ~ lucky them! Rags for shoes ~ well if it's warm there, and they have dirt paths/roads I don't see that being a bad thing.

 

[ccgirl]

It gets complicated, because different types of income are treated differently.

Limiting the conversation strictly to earned income and income taxes, you're right - the more you make, the higher your effective rate. But when you start tossing the exclusion of unearned income from the social security system, the cap on social security contributions, the separate rate for capital gains, and all the other complexities of our system as a whole you find that the middle class does in fact pay higher rates than the very wealthy.

The rich don't pay the least by any means - that goes to those at the very bottom of the ladder who pay negative effective rates - but they do often pay a lower rate than the middle/upper middle classes who have a relatively high income that is all earned rather than derived from ownership and investments. Warren Buffett raised this point a few years back by pointing out that he pays a much lower effective tax rate than his secretary. [/QUTOE]

This is the point I was trying to make. Thanks, you added the explination and detail.

Thank you both. I get it now. That is why I was so confused. I am very fortunate to make a good salary but we don't have a lot of other stuff (investments,stocks etc) mixed in. Just a mortgage.

 

[MrsPete]

Of course, YOU were the one who brought up the bosses owing their employees "fair" wages. I just asked for a definition.

Remember in elementary school you used to read paragraphs and discern the main point from the details? That's what we're doing here.

I said that the boss in the little illustration owes his workers a fair wage, a safe workplace, etc. -- not a beer after work. The main point was that he's not greedy or cheap if he doesn't pony up for a beer. You're focusing on the word "fair", a detail that cannot be answered unless we know what type of job we're discussing, where these people live, what type of experience and expertise they have. Your question has no answer.

I'll be honest, I've never known what the "market average" is for my job. Whenever I've looked it up (according to the internet) I wasn't being paid "average".

I'm sure the boss knows what's average, expected, typical for the job, the employee's expertise, and the area.

I agree, the boss doesn't "owe" anyone a beer... unless they agreed to be paid in beer.

Then you DO get the main point. What are you arguing about?

A LEO is a Law Enforcement Officer (cop, policeman).

Ah. I didn't get that.

I disagree. If employers didn't have to pay minimum wage the wages for THOSE jobs will drop. Because there are more people looking for work than there are jobs. Job 'x' has two candidates, 'a', and 'b'. 'a' says "I'll work for minimum wage'. 'b' says 'I'll work for 5 cents less an hour.' Now, let's be honest, these are not difficult jobs. Why would an employer pay the extra 5 cents an hour? B is happy he has a job, the employer is happy because he got a "cheap" worker. Now, 'c' wants a job. He's desperate. He's willing to do the job for 50 cents less, because 'hey, it's a paycheck'. Sorry 'b', you're on the unemployment line. See how this can work? Again, this only affects people at the bottom portion of the pay scale

Except for the fact there are hundreds if not thousands of people willing to do the job for 1/2 pay because it's a paycheck. Aren't you and others saying people should take extra jobs to get income? Can't you say the same thing about taking a lower wage?

Some economists agree with you, others do not. If those people with more expertise can't agree, you and I aren't likely to do so. So I'll just point out that what we're doing NOW (minimum wage) isn't really working.

In my area we certainly don't have hundreds or thousands of people looking to work for half price. Low-level jobs are available here, but people don't want them.

The Industrial Era started in 1938? That was when the Federal Minimum Wage went into effect.

The NEED for work reform existed prior to that -- minimum wage (and other work-related reforms) were enacted to correct problems that had arisen in decades prior. However, society has changed. Norms within the work world have been established.

And if I left, how exactly would I feed my family? Not everyone has the luxury of being able to walk off a job even if it doesn't pay enough. Someone who is making minimum wage now cannot possibly consider walking off a job without knowing there is another job waiting--like TODAY.

You need the job. The employer needs you because he can't operate his business alone. Neither of you can afford to walk away from one another. That's why minimum wage doesn't need to be a law -- it's something that'd work itself out anyway.

But government spending has bigger problems than welfare abusers. Yes, there needs to be a way to cut down on abuse. But (as mentioned earlier), that's going to cost even MORE money.

I agree that we have problems OTHER THAN welfare abusers, but I don't know that we have bigger problems that the attitude of entitlement and decrease in personal responsibility that has come along with the exponential growth of government.

Regardless, even if we have other problems, THIS is still a problem. That doesn't negate other issues, sure, but it's still the one being discussed here.

Again, they need the skills to get those jobs and it is going to take MORE money in the system to get them those skills. And, of course, there has to actually BE jobs to get.

I totally agree that people need to gain skills necessary for the work force -- but they should be getting these skills by attending public school, which is available for everyone.

And, please, do not go on to me about how "hard" they worked. Show me where one of them worked harder than the folks in the GM plants and I will reconsider their deserving of the bonuses and the conferences in the Bahamas or where ever it was.

You're implying that hard physical labor is the equivalent of being in management. Sure, the guy who works on the assembly line works harder physically, BUT the professional -- the VP of sales or the Human Resources manager -- brings in management skills and other abilities, skills that the guy on the line probably doesn't have. You really can't compare the two job arenas.

good luck getting a lazy person that just wantz their check to pick up trash. hell most of them dont clean their own trash off the streets in the gettho opps i meant free houseing and they get free trash service too.which is $12 a month for at my non free housing...

So instead of a monthly check, pay them $20 per bag of garbage picked up off the road. I know, I know, that'd never work -- but you have to admit it sounds pretty good.

I think the component that is missing in this argument is what happens if the govt gets out of the welfare business:

1. I up my charity dollars - as would many of my friends and the businesses they own...b/c we would feel like we could choose organizations that would be good stewards of our money. I am sure that a $1000 given to a non-profit will go farther than $1000 given to the government. More non-profits will actually lead to more jobs as well.

2. I will also have more disposable income...so I will buy more things, take more trips, etc. and what will that do - CREATE MORE JOBS

3. With lower tax responsibilities - employers will keep jobs in the US and have more money to pay for salaries.

4. There will be more jobs in the US for the people who are unskilled therefore meaning less people will need to be on welfare.

The people who TRULY need assistance will be able to get it - those who are lazy and working the system will not and will end up having to get a job - which will be available b/c there will be more jobs b/c people will be spending more money which will create more jobs.

Yep, makes sense to me. Throw in that people who are able (but unwilling) to work will be forced towards personal responsibility because fewer people will be willing to support the able-bodied and capable.

why do usa church always help people in elsalvador, kora, china, why not adopt a family here and build them a house and "teach them to fish"?

1) The general feeling is that people here are already receiving their handouts via taxes and the government, whereas the need in 3rd world countries is greater. 2) It's Biblical. Jesus' last command to His followers before He returned to heaven was to spread the gospel throughout the world. We have churches here in America; anyone who wants to visit one has that opportunity.

We will ALWAYS need more unskilled workers than degreed professionals and skilled tradespeople.

The employment agency speaker who addressed our senior class TODAY says that only 15% of American jobs are "unskilled" -- meaning fast food, etc. (and those jobs essentially go to high schoolers and people who need a part-time job) The greatest need today is for what you're calling skilled tradespeople, people with job training past high school, though probably not a bachelor's degree.

 

[Karlzmom]

That was precisely my point. The Constitution, as a whole, is a dynamic document. I very much doubt that the founding fathers assumed that life in America would continue along the same path 200 years down the road.

Fwiw, I am a social studies teacher and teach government as part of one of my classes. I've read the Constitution and have the great privilege to teach about it to middle school students.

Good for you. I'm an attorney We can agree to disagree about the "living Constitution" debate. I don't think any concept that the Government would be the end all - be all would ever have been accepted by the Founders. There was no sense of a public charity in their day. The notion that the government had to power to take from some to give to another, even for "noble" purposes would have been completely foreign.

 

[palavra]

We are in a good position because we didnt sit back and wait for anyone to do it for us..

As for his family, his brothers would staighten him out for me lol, yes we are tight family, we all help each other as family should. im srry for you if you dont have good family support.

I say we because we have both worked in this marriage to get to where we are now.

The facts are there will always be poor kids, but i choose to change from being poor, if i can so can they, stop makeing excuses for people.

and when is giving someone a laptop to play on from my taxes dollar really helping them.

You know, one mark of ignorance is to assume that everyone else's life works the same way yours does. It sounds like you have been blessed with good family support, a good husband and the ability to make changes that others wish they could. Believe me, all the "hard work" in the world won't make a bit of difference in some people's situations.

 

[palavra]

i vote yes if they can never change the rate and they tax everything flat food, sinful things, cars, house all the same not different levels depending on what lobbyest pay what to get a lower rate and almost forgot stop borrowing money....balanced books.

Could you please start using capital letters, sentences and punctuation? It is so hard to understand what you post.

 

[palavra]

Good for you. I'm an attorney We can agree to disagree about the "living Constitution" debate. I don't think any concept that the Government would be the end all - be all would ever have been accepted by the Founders. There was no sense of a public charity in their day. The notion that the government had to power to take from some to give to another, even for "noble" purposes would have been completely foreign.

And we don't live in the same world that America was 200 years ago. 200 years ago, people who were homeless with no means of support could pack up the wagon, go west, claim land and start over. Today, those who can't find a job and lose their houses and have no other means of support have no way of starting over. Sure, a person can work at McDonalds, but he or she can't afford to live on what a minimum wage worker would make. So what would you propose those people do? Stand on the corner with "will work for food signs"?

I just don't understand the apples to oranges comparison of the America in the late 18th century to the America of the 21st century.

 

[Paging Tom Morrow]

I've proposed it before... no deductions, no credits. You pay taxes based strictly on your income. Yes, it needs to be progressive. Sorry. Those who make more money have more disposable income.

The government saves money because you no longer need the IRS (or at least not at the size it is now).
The government gets money because a family making less than $50K is now putting INTO the budget.

You can still have food stamps/WIC based on the number of kids and income, but there needs to be a limit on what you can use that money for.

Again, I challenge everyone to take their 'tax owed' divided by their 'gross' income and see how close I come in MY progressive scale...

$10K-$20K 1%
$20K-$30K 2%
$30K-$40K 3%
$40K-$50K 4%
...
$250K+ 25%

I'll tell you right now I fit right in. So does the 'sample' family I included in this post.

That's the type of plan that kills small businesses.

Under your plan, a family who earns 250k pays $62,500 in taxes. While a family that takes in 200k pays $40,000. While that may seem fair to you, the reality is that the the family that earns 250k is paying a 45% tax rate on the additional money earned ($22,500 additional tax on only $50,000 in additional earnings).

That difference is a huge disincentive for people who run small businesses to risk their own personal capital to make additional money.

While $200k might seem like a obscene amount of money for most folks, in the part of the country that I live in, that's the amount of money that two teachers who have masters degrees and have been working for 10 years can expect to make. Of course, house here routinely go for $500k and property taxes can run $15k per year. (Also read: You need to make $200k to be middle class)

 

[luvsJack]

So... are the Peruvians happy? I'm sure most are, as long as you are healthy, safe & warm you'll be alright - people don't need what we consider the "comforts" of life to be happy. I'm somewhat envious of people who live like that, they don't deal with a lot of the crap we do ~ they don't have TVs, computers, cell phones etc ~ lucky them! Rags for shoes ~ well if it's warm there, and they have dirt paths/roads I don't see that being a bad thing.

Seeing the pictures that were taken, they look very happy. I think everyone fell in love with the children.

My nieces and sister went to El Salvador and said the people there seem very happy. The grown ups enjoyed all the things they did for the kids as much as the kids! My niece's daughter got a real kick out of painting the grown ups faces at a carnival day they had. But they seemed very happy and the most simple thing brought them real joy. Mardi Gras beads were a BIG hit!

I agree with you about being envious. Sometimes it seems like such a shame that we can't get back to that kind of simple life.

 

[HHSTigerFan]

So obviously we can't afford all of the freebies that some people here think we as US citizens are entitled to at the current revenue.. So whats the end game? Keep raising taxes and killing the middle class? Raising corporate taxes and killing more jobs?

 

[EclecticWAHM]

That is part of the problem. There is a portion of our population that never donates any money. There are people who are in office right now who are wealthy and donated very little to charity. I would hope that if their taxes came down, they would be more likely to donate. But then again, maybe not. But having the government run welfare programs is an extremely inefficient way of doing it.

Also, as an aside. One benefit of choosing your own charity over blindly handing over tens of thousands of dollars to the government to dole it out is that if you see a charity that is not doing things right, you stop giving.

Good suggestions.

I've heard from various sources that the poor give more to charity (as a percentage of income) than the wealthy do. This doesn't surprise me for some reason. Here's an interesting article about it: http://www.nytimes.com/2010/08/22/magazine/22FOB-wwln-t.html

 

[palavra]

So obviously we can't afford all of the freebies that some people here think we as US citizens are entitled to at the current revenue.. So whats the end game? Keep raising taxes and killing the middle class? Raising corporate taxes and killing more jobs?

Cutting pork belly gov't pet projects would help. Your question is obviously the question of the day. What do we do?

One thing that I feel we can't do is try to look backward. We can't return to the "good ole days" when raising yourself up by your bootstraps and hard work guaranteed you a pretty decent lifestyle. There are so many things in our current economic situation that need to be addressed and not glossed over. Living expenses are getting out of control-gas, medical bills, food bills are taking larger chunks of our checks, and we are the lucky ones. At least we have jobs.

 

[Colleen27]

The employment agency speaker who addressed our senior class TODAY says that only 15% of American jobs are "unskilled" -- meaning fast food, etc. (and those jobs essentially go to high schoolers and people who need a part-time job) The greatest need today is for what you're calling skilled tradespeople, people with job training past high school, though probably not a bachelor's degree.

That's interesting. BLS statistics seem to contradict that, with about 20% of current jobs in clearly low-wage occupations and even more in vague/non-specific categories that make separating the minimum wage jobs from better paying jobs in the same category (press operator vs. die setter, for example) difficult.

Good for you. I'm an attorney We can agree to disagree about the "living Constitution" debate. I don't think any concept that the Government would be the end all - be all would ever have been accepted by the Founders. There was no sense of a public charity in their day. The notion that the government had to power to take from some to give to another, even for "noble" purposes would have been completely foreign.

Actually, the history of publicly funded welfare in our country goes all the way back to the colonies. It was just framed a little differently, as mandatory tithing and localized taxation/fees. Federal welfare is a relatively new concept but public assistance is not.

So obviously we can't afford all of the freebies that some people here think we as US citizens are entitled to at the current revenue.. So whats the end game? Keep raising taxes and killing the middle class? Raising corporate taxes and killing more jobs?

How about looking at other places to make cuts? There is a lot of room to trim without doing away with our social safety net. We could start with the billions we're spending to prop up various foreign governments, and refocus our military efforts on defending our nation rather than trying to secure world peace.

While we're at it, the farm bill is up for reauthorization this year amidst record-setting food commodity prices and correspondingly high farm revenues... Seems like there's a rather massive system of subsidies in there that we could take a look at tapering off.

Real healthcare reform would be a start too, because rising health care costs are killing both our middle class and our economy and will continue to do so as long as the current system of employer-provided benefits is in place. We can't expect employers to bear those costs and expect Americans to be attractive employees, nor can we continue the offhanded subsidies built into health care pricing for those who cannot pay.

Tax reform needs to happen as well, to balance out the rates more appropriately at both ends of the scale and to cut waaaay back at collection-related bureaucracy, loopholes, and other unintended consequences of the current tax code's complexity.

And we need to brainstorm some real solutions for competing on a global scale without hollowing out the middle class by shipping jobs overseas. It isn't just a question of the jobs lost now - process improvements come from familiarity with the processes, and so long as we're just coming up with the ideas but outsourcing the implementation we will not lead the way in innovation.

And that's just scratching the surface, but I think I'm already skating too close to the "no politics" rule so I'll stop now before I get myself into trouble.

 

[KennyandKim]

What I find funny is that business owners think $10 or $15 an hour is a "fair wage" because that is what was agreed upon, but want to complain that these same people are getting too much money in public assistance or refundable tax credits. That these families should starve or go without heat/lights/water because they can't make it on the $20,000 to $30,000 a year that they are so generously being paid.

Companies take advantage of workers to increase their bottom line. If unemployment is so bad that you have 100 overqualified people fighting for one $10 an hour job, then why pay more? (Even though your bringing in millions or billions in profit?)

You're against EIC? You think it is "stupid"? I think SS is stupid and would LOVE to put that money in my own retirement account. Instead, the entire fund will be bankrupt years before I am old enough to benefit (2046, under the current rules.) I would like to see kind of SS reform just as much as you would like to see the EIC eliminated.

Totally agree with your comment about SS. I pay higher SS than someone who makes minimum wage but am I made NO. What makes me mad is I will spend my entire working career paying into something I will never see returned to me. The system will be obsolete before I am old enough to collect it.

 

[HHSTigerFan]

Cutting pork belly gov't pet projects would help.

Don't know if its true, but a local guy on the radio claimed pork projects only make up .06% of the federal budget..

 

[palavra]

Don't know if its true, but a local guy on the radio claimed pork projects only make up .06% of the federal budget..

I just noticed I said "pork belly" instead of "pork barrel". I must have been hungry or something

I don't know what the percentage is, and I don't have a good answer for our deficit problem either. It may take a major overhaul of our whole government system.

 

[HHSTigerFan]

Biggest thing that needs to change in Washington and in Main St USA-- Mindset

People need to develop the mindset that while the govt is there to help, they shouldn't be the primary source of help..

To go along with that, the people that we elect need to get rid of the mindset that they can spend their way to winning an election, get expensive projects to their districts or vote for more entitlements and the voters will send them back to Washington..

I was watching the news tonight, talking about the big blizzard we had in the Chicago area.. first group of people they talked to whined and complained about how their street hadn't been plowed yet and they couldn't make it to work today and probably won't until tomorrow, they said it was the cities fault.. the next story was about another street that hadn't seen a snow plow , those people banded together and cleaned their own street off with their own snow blowers and shovels, made it to work today and obviously will tomorrow as well.. How refreshing that second story was to watch..

 

[sam_gordon]

That's the type of plan that kills small businesses.

Under your plan, a family who earns 250k pays $62,500 in taxes. While a family that takes in 200k pays $40,000. While that may seem fair to you, the reality is that the the family that earns 250k is paying a 45% tax rate on the additional money earned ($22,500 additional tax on only $50,000 in additional earnings).

That difference is a huge disincentive for people who run small businesses to risk their own personal capital to make additional money.

While $200k might seem like a obscene amount of money for most folks, in the part of the country that I live in, that's the amount of money that two teachers who have masters degrees and have been working for 10 years can expect to make. Of course, house here routinely go for $500k and property taxes can run $15k per year. (Also read: You need to make $200k to be middle class)

It's a huge incentive? Are you sure? You're right about my plan... someone making $200K pays $40K in taxes & someone making $250K pays $62,500 in taxes. That's a $22,500 difference. Got it.

I did the math on the 2010 tax tables. For a single filer, someone making $200,000 pays $51,116. Someone making $250,000 pays $67,616. That's a $16,500 difference. Yes, someone making $250K pays a higher tax bracket than someone making $200,000. Right now, someone making $200K pays a higher tax bracket than someone making $150K. And let's not forget, that any money after $171K is taxed at 33%.

The point is the tax system as it stand right now is complicated. Filers pay others to "find every deduction". Simplify it.

 

[sam_gordon]

Biggest thing that needs to change in Washington and in Main St USA-- Mindset

People need to develop the mindset that while the govt is there to help, they shouldn't be the primary source of help..

To go along with that, the people that we elect need to get rid of the mindset that they can spend their way to winning an election, get expensive projects to their districts or vote for more entitlements and the voters will send them back to Washington..

I was watching the news tonight, talking about the big blizzard we had in the Chicago area.. first group of people they talked to whined and complained about how their street hadn't been plowed yet and they couldn't make it to work today and probably won't until tomorrow, they said it was the cities fault.. the next story was about another street that hadn't seen a snow plow , those people banded together and cleaned their own street off with their own snow blowers and shovels, made it to work today and obviously will tomorrow as well.. How refreshing that second story was to watch..

Can I just say this is the first post from you in this thread that I can say ? I don't think anyone is denying there is abuse in the system and there needs to be a way to eliminate that. But "throwing the baby out with the bath water" (getting rid of ALL welfare, handouts, credits, etc) isn't the answer. There are people those programs DO help, and without those programs would be stuck under a bridge.