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Author Topic: Package to Aid Most, Especially Wealthy  (Read 2851 times)

Offline soflorattler

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Package to Aid Most, Especially Wealthy
« on: December 07, 2010, 08:58:14 PM »
The deal to extend the Bush-era tax cuts for two years includes a bevy of additional credits and deductions that will reduce the burden on nearly all households.

But the tax benefits will flow most heavily to the highest earners, just as the original cuts did when they were passed in 2001 and 2003. At least a quarter of the tax savings will go to the wealthiest 1 percent of the population.

The tentative deal includes a two-year patch for the alternative minimum tax, a reduction in the payroll tax and a plan to reinstate the estate tax with lower rates and higher exemptions than in 2009 — all of which will offer far more savings for high earners than those in the low- or middle-income bracket.

The wealthiest Americans will also reap tax savings from the proposal’s plan to keep the cap on dividend and capital gains taxes at 15 percent, well below the highest rates on ordinary income.

And negotiators have agreed that the estimated $900 billion cost of the cuts will simply be added to the deficit — not covered by reductions in spending or increases in other taxes. That is good news for hedge fund managers and private equity investors, who appear to have withstood an effort to get them to pay more by eliminating a quirk in the tax code that allows most of their income to be taxed at just 15 percent.

In fact, the only groups likely to face a tax increase are those near the bottom of the income scale — individuals who make less than $20,000 and families with earnings below $40,000.

“It’s going to look like the rich are getting richer again,” said Anne Mathias, an analyst for MF Global Inc.

In the agreement, which breaks a campaign pledge to eliminate some tax breaks for the top 2 percent of American earners, President Obama won a few concessions from Republicans, including a 13-month extension in government benefits for the long-term unemployed. After several extensions, the maximum has been 99 weeks.

The administration also succeeded in extending several of the tax credits in last year’s stimulus plan to aid low- and moderate-income Americans: the earned-income tax credit, the child credit, the child and dependent-care credit and the tuition deduction.

As a result, families with an income near the median of $55,000 would owe about $2,700 less in taxes than if the Bush-era cuts had been allowed to expire.

A two-income couple earning $146,000 would owe about $7,000 less than if the tax cuts were allowed to expire, and about $3,400 less than they did in 2009.

The proposal does not include an extension of Mr. Obama’s signature tax cut, the Making Work Pay credit, which provided a credit of up to $400 for individuals and $800 for families of low and moderate income. Instead, the plan creates a one-year reduction in Social Security payroll taxes, which are generally levied on the first $106,800 of income. For an individual earning $110,000, that provision would reduce payroll taxes by $2,136.

Although the $120 billion payroll tax reduction offers nearly twice the tax savings of the credit it replaces, it will nonetheless lead to higher tax bills for individuals with incomes below $20,000 and families that make less than $40,000. That is because their payroll tax savings are less than the $400 or $800 they will lose from the Making Work Pay credit.

“It will come to a few dollars a week,” said Roberton Williams, an analyst at the nonpartisan Tax Policy Center, “but it is an increase.”

To the wealthiest Americans, however, an assortment of breaks is available.

The plan includes a two-year “patch” for the alternative minimum tax, which is now paid by about 4 million taxpayers with income in the mid- to high six figures. Without the patch, more than 20 million additional taxpayers would have been liable for that tax.

The estate tax — which was allowed to lapse this year and was scheduled to resume at a rate of 55 percent on most assets above $1 million — will be reinstated under less onerous terms. Estates over $5 million will be subject to a 35 percent tax.

The proposal will also maintain the current rates on dividends and capital gains, averting scheduled increases to ordinary income and 20 percent, respectively.

The marginal tax rate on high incomes will also remain unchanged. The top brackets had been scheduled to increase to 36 percent and 39.6 percent, from 33 percent and 35 percent.

Under Mr. Obama’s failed proposal, which would have raised the rates on income over $250,000 for families and $200,000 for individuals, the taxpayers at the top 1 percent of the income scale — those with incomes above $564,000 — would have received an average tax break of $28,000. Under the agreement reached with Republicans, the top 1 percent will receive breaks of about $70,000.

Offline Wildman78

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Re: Package to Aid Most, Especially Wealthy
« Reply #1 on: December 07, 2010, 09:11:52 PM »
And negotiators have agreed that the estimated $900 billion cost of the cuts will simply be added to the deficit — not covered by reductions in spending or increases in other taxes.

 :shrug:  Oh well.

Offline y04185

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Re: Package to Aid Most, Especially Wealthy
« Reply #2 on: December 08, 2010, 07:16:18 AM »
And negotiators have agreed that the estimated $900 billion cost of the cuts will simply be added to the deficit — not covered by reductions in spending or increases in other taxes.

 :shrug:  Oh well.

cnn reported on air a 700 million dollar difference.
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Offline soflorattler

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Re: Package to Aid Most, Especially Wealthy
« Reply #3 on: December 08, 2010, 07:27:37 AM »
And negotiators have agreed that the estimated $900 billion cost of the cuts will simply be added to the deficit — not covered by reductions in spending or increases in other taxes.

 :shrug:  Oh well.

cnn reported on air a 700 million dollar difference.


::)



Negotiators crunching the numbers versus a news reporting agency. Be for real...

Offline y04185

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Re: Package to Aid Most, Especially Wealthy
« Reply #4 on: December 08, 2010, 07:50:34 AM »
And negotiators have agreed that the estimated $900 billion cost of the cuts will simply be added to the deficit — not covered by reductions in spending or increases in other taxes.

 :shrug:  Oh well.

cnn reported on air a 700 million dollar difference.


::)



Negotiators crunching the numbers versus a news reporting agency. Be for real...



who do you think told the news reporting agency
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Offline Wildman78

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Re: Package to Aid Most, Especially Wealthy
« Reply #5 on: December 08, 2010, 08:33:24 AM »
Maybe y0185 meant to write 7 hundred billion instead of 7 hundred million.

Tax deal: Rich aren't the only ones who benefit

NEW YORK (CNNMoney.com) -- Sure, the wealthy will make out like bandits in the tax-cut deal, but middle-class and lower-income folks will reap benefits too.

Much of the attention since the deal was announced Monday night has been focused on extending the Bush tax cuts for the rich and minimizing the estate tax.

But other provisions in the $800 billion deal, including the payroll tax holiday and child tax credit, will greatly assist ordinary Americans. And those who are unemployed will benefit from an extension to file for federal jobless benefits through 2011.

http://money.cnn.com/2010/12/08/news/economy/tax_cuts_middle_lower_income/index.htm

It was not immediately clear if Obama's defense of the deal -- as well as Vice President Joe Biden's one-on-one efforts behind closed doors on Capitol Hill -- would sway more liberal Democrats. The overall cost to the U.S. treasury of the controversial compromise will be between $600 billion and $800 billion over two years, according to CNN estimates.

http://articles.cnn.com/2010-12-07/politics/tax.deal_1_tax-cuts-middle-class-tax-deal?_s=PM:POLITICS



« Last Edit: December 08, 2010, 10:03:49 PM by Wildman78 »

Offline uchighlander

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Re: Package to Aid Most, Especially Wealthy
« Reply #6 on: December 08, 2010, 09:51:58 AM »
When is the last time anyone on this board was given a job by a poor person. Dyam....you all act like being rich is a crime. Being rich isn't a crime.....it's something everyone aspires to be....that's what make this country great.....achievment. GO VIKINGS!!!

Offline Wildman78

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Re: Package to Aid Most, Especially Wealthy
« Reply #7 on: December 08, 2010, 10:00:46 AM »
When is the last time anyone on this board was given a job by a poor person. Dyam....you all act like being rich is a crime. Being rich isn't a crime.....it's something everyone aspires to be....that's what make this country great.....achievment. GO VIKINGS!!!

I really don't see how your statement relates to anything I posted. I'm just trying to figure out how are you going to reduce the deficit if you don't increase tax revenue. You provided an explanation in the other thread.

Offline uchighlander

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Re: Package to Aid Most, Especially Wealthy
« Reply #8 on: December 08, 2010, 10:03:56 AM »
When is the last time anyone on this board was given a job by a poor person. Dyam....you all act like being rich is a crime. Being rich isn't a crime.....it's something everyone aspires to be....that's what make this country great.....achievment. GO VIKINGS!!!

I really don't see how your statement relates to anything I posted. I'm just trying to figure out how are you going to reduce the deficit if you don't increase tax revenue. You provided an explanation in the other thread.
Just making a comment about how all these articles attack the rich....well guess what ? The top earners pay 50% of the taxes so the should get the biggest breaks. GO VIKINGS!!!

Offline soflorattler

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Re: Package to Aid Most, Especially Wealthy
« Reply #9 on: December 08, 2010, 12:01:16 PM »
When is the last time anyone on this board was given a job by a poor person. Dyam....you all act like being rich is a crime. Being rich isn't a crime.....it's something everyone aspires to be....that's what make this country great.....achievment. GO VIKINGS!!!

I really don't see how your statement relates to anything I posted. I'm just trying to figure out how are you going to reduce the deficit if you don't increase tax revenue. You provided an explanation in the other thread.
Just making a comment about how all these articles attack the rich....well guess what ? The top earners pay 50% 37% of the taxes so the should get the biggest breaks. GO VIKINGS!!!

Why can't they wait on their "break" seeing that we're in this crisis that benefited them in th first place? It's not like they're hurting for the money.

Offline EB

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Re: Package to Aid Most, Especially Wealthy
« Reply #10 on: December 08, 2010, 01:03:48 PM »
When is the last time anyone on this board was given a job by a poor person. Dyam....you all act like being rich is a crime. Being rich isn't a crime.....it's something everyone aspires to be....that's what make this country great.....achievment. GO VIKINGS!!!

I really don't see how your statement relates to anything I posted. I'm just trying to figure out how are you going to reduce the deficit if you don't increase tax revenue. You provided an explanation in the other thread.
Just making a comment about how all these articles attack the rich....well guess what ? The top earners pay 50% 37% of the taxes so the should get the biggest breaks. GO VIKINGS!!!

Why can't they wait on their "break" seeing that we're in this crisis that benefited them in th first place? It's not like they're hurting for the money.

This is so accurate.  Those who make more money generally use more of the commons.  The commons, what the public use and own, cost money.  The wealthy can wait for a break.

Poor people may not hire other although those who have run businesses and acquired a lot of debt have.  However, the poor, working class (or what is left of it) and middle class spend money on business that many rich people own.  It has helped a lot of rich people make profits and get richer.

Offline Ken

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Re: Package to Aid Most, Especially Wealthy
« Reply #11 on: December 08, 2010, 02:36:15 PM »
If the Bush tax law will create more jobs, why did it not create jobs during the Bush administration.  Was not this law in effect then???

Offline Wildman78

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Re: Package to Aid Most, Especially Wealthy
« Reply #12 on: December 08, 2010, 02:38:30 PM »
If the Bush tax law will create more jobs, why did it not create jobs during the Bush administration.  Was not this law in effect then???

Good question. How come the Bush tax cuts didn't create more jobs while Bush was in Office.

What do the experts say about that.
« Last Edit: December 08, 2010, 02:54:43 PM by Wildman78 »

Offline Que82

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Re: Package to Aid Most, Especially Wealthy
« Reply #13 on: December 08, 2010, 02:47:32 PM »
Well if anyone is waiting on a rational explanation to that question from Uchi, OS or Y, please go ahead and take care of whatever important business you have because it ain't gonna happen no time soon.  :shrug:
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Offline Ken

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Re: Package to Aid Most, Especially Wealthy
« Reply #14 on: December 08, 2010, 03:35:02 PM »
Well the truth is you get rich in America by hiring as less people as possible , but at the same time getting to the same amount of production as if you had a larger amount of workers.  That is whay is going on in America.  Companies are findinig that they can get the same amount of work with less workers on the payroll.

 

 

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