The National tax rates, payments, etc., etc., etc.

[szh]

By the way, for those of you on the assinine "rich don't pay taxes" bandwagon, look at the actual dollars paid by both Obama and McCain (EDIT: in the other thread now - I split the original thread into two).

The myth that all rich people have these wonderful tax shelters, so that they never pay taxes, is just so much BS, that it irritates me when anybody spouts that crap.

So, please stop spewing that misinformation.

Z

[ishkabibble]

By the way, for those of you on the assinine "rich don't pay taxes" bandwagon, look at the actual dollars paid by both Obama and McCain.

The myth that all rich people have these wonderful tax shelters, so that they never pay taxes, is just so much BS, that it irritates me when anybody spouts that crap.

So, please stop spewing that misinformation.

Z

Who, outside of telco perhaps, said that? I see "the rich pay roughly the same effective tax rate as the middle class", but none of what you are saying.

[rn79870]

The myth that all rich people have these wonderful tax shelters, so that they never pay taxes, is just so much BS, that it irritates me when anybody spouts that crap.

So, please stop spewing that misinformation.

Z

I don't want to go into detail here, but I know for a fact that many wealthier people are in a position to take advantage of many, many more tax shelters and programs that poorer people can't take advantage of. So yes, wealthier (upper middle class) people do pay proportionally less tax than middle tax workers, unless they simply don't understand the system.

[szh]

Who, outside of telco perhaps, said that? I see "the rich pay roughly the same effective tax rate as the middle class", but none of what you are saying.

My apologies. I did generalize. Not all people here are saying what I attributed to them!

Z

[szh]

I don't want to go into detail here, but I know for a fact that many wealthier people are in a position to take advantage of many, many more tax shelters and programs that poorer people can't take advantage of. So yes, wealthier (upper middle class) people do pay proportionally less tax than middle tax workers, unless they simply don't understand the system.

Actually, I would prefer that you did go into detail. Because, I am confident you are incorrect. This is an old myth that has no basis in reality.

My wife has an MBA and does taxes for people - working for HR Block as a seasonal tax preparer - and she knows the facts and agrees with me! She is a registered Democrat, by the way, and is planning on voting for Obama for sure - politics are a fun discussion at our house.

Z

[ishkabibble]

2005 Effective Tax Rates:

Top 1% 31.2%Top 5% 28.9%Top 10% 27.4%Top 20% 25.5%Top 40% 17.4%

Source: http://www.cbo.gov/ftpdocs/88x...s.pdf

[AZhitman]

Actually, I would prefer that you did go into detail. Because, I am confident you are incorrect. This is an old myth that has no basis in reality.

I was thinking the same thing.

[Jimefam]

http://www.timesonline.co.uk/t...5.ece

ish those tax rates are not only decieving they are very out of date

http://www.walletpop.com/taxes...92756

But even these rates are not what people actually pay. Most peoples effective tax rate is alittle lower than there tax bracket suggest do to some deduction. The difference is that the higher income you go the more ways to earn deductions. For example capital gains tax for over the 25% income tax bracket is 15% which means that gains on investments such as real estate and the stock market are taxed at significantly lower rates. The average american doesn't have the financial resources to make a SIGNIFICANT income on these investments and so recieves no benefit. The loop holes for business owners are even larger.

So szhosain your wife is right in that an employee who makes 120k per pays a higher rate than the janitor who makes 25k but that is only because niether is "rich" or the owner of said company. But if the owner of that large company pays more in taxes than his middle management he needs new advisers!!! . No disrespect to H&R but not to many informed fat cats are getting there taxes done there. I worked as a financial advisor at wachovia for a couple of years and dealt with every thing from average employees to people who belong to this:

http://www.calibre.com/

Which is an independent arm of Wachovia Bank that deals with multi- generational wealthy families with investable assets surpassing $25 Mil. Trust me these people pay a LOW percentage of taxes relative to income. Or put another way these people pay a lower % than me. On a side note I am a staunch capitalist and actually think that this is fair the way it is BUT Unlike fox news i do believe in balanced and fair reporting . Now have at me

[szh]

2005 Effective Tax Rates:

Top 1% 31.2%
Top 5% 28.9%
Top 10% 27.4%
Top 20% 25.5%
Top 40% 17.4%

Source: http://www.cbo.gov/ftpdocs/88xx/doc8885 ... xRates.pdf

Thanks! Let's use your source to illustrate some more points! Using the data for 2005 on page 6 of that document:

1. In the Top 1% (1.1 million households), average pre-tax income was $1,558,500 and average post-tax income was $1,071,500 for that percentage of 31.2% of their income paid in taxes. The average tax payment was thus $487,000 per household! Total tax dollars paid: $535,700,000,000.

That is 535 Billion dollars.

2. In the Top 5% (5.8 million households), average pre-tax income was $520,200 and average post-tax income was $369,800 for that 28.9% of their income paid in taxes. The average tax payment was thus $150,400 per household. Total tax dollars paid: $872,320,000,000.

That is 872 Billion dollars.

3. In the Top 10% (11.7 million households), average pre-tax income was $339,100 and average post-tax income was $246,300 for that 27.4% of their income paid in taxes. The average tax payment was thus $92,800 per household. Total tax dollars paid: $1,085,760,000,000.

That is 1,085 Billion (or 1.085 Trillion) dollars.

Thus, since the total tax was $1,992,300,000,000:

1. The top 1% of wage earners paid 26.9% of the total taxes.
2. The top 5% of wage earners paid 43.8% of the total taxes.
3. The top 10% of wage earners paid 54.5% of the total taxes.

Some more information:

1. The bottom 20% of wage earners paid 4.3% of their income in taxes.
2. The next 20% of wage earners paid 9.9% of their income in taxes.
3. The next 20% of wage earners paid 14.2% of their income in taxes.
4. The next 20% of wage earners paid 17.4% of their income in taxes.
5. The top 20% of wage earners paid 25.5% of their income in taxes.

This, inspite of the miraculous tax shelters the rich seem to find that were not available or accessible to the poor!

By the way, the reason the bottom 20% above actually paid less than the Social Security rate, is because their Federal income tax rate were actually -6.5% (that is right, negative!), and then SS and other taxes (Corp, Excise) kicked in to make the number go back above 0%).

The next 20% had individual income tax rates of -1.0% (also negative) before the other taxes kicked in to make it +9.9%.

Here are some more interesting calculations from those numbers in that document.

1. The bottom 20% of wage earners (24.1 million households) paid 0.7% of the total taxes.
2. The next 20% of wage earners (22 million households) paid 4.1% of the total taxes.
3. The next 20% of wage earners (22.2 million households) paid 9.2% of the total taxes.
4. The next 20% of wage earners (22.6 million households) paid 16.9% of the total taxes.
5. The top 20% of wage earners (23.1 million households) paid 68.5% of the total tax.

Not only do the rich pay MORE in percentages, they pay more in absolute amounts, and a far larger percentage of the total tax collected!

Amazing how cold hard facts can easily show up the myths and beliefs about the rich being greedy people that they are not helping the country out and not paying their "fair share" and are hiding all their money in tax shelters, etc., etc., etc.

Such total complete BS!

So ... tell me again how some of you all can possibly think that the "rich" are not paying taxes, or finding these miraculous tax shelters to avoid their "fair share" of taxes - either percentages OR absolute dollars?

Edit: I just noticed that page 7 of that PDF shows these percentages too!

Z

[szh]

http://www.walletpop.com/taxes...92756

As you point out, this is artificial (it is still a graduated tax system), since the calculations are based on AGI, and the deductions are not taken into account.

Plus, and people forget this, these deductions are phased out above certain income levels! So, the "rich" do not get to use them.

So szhosain your wife is right in that an employee who makes 120k per pays a higher rate than the janitor who makes 25k but that is only because niether is "rich" or the owner of said company. But if the owner of that large company pays more in taxes than his middle management he needs new advisers!!!

Look at the real raw data (in my previous post) and you may be surprised to learn just what reality is!

The Buffet article is simplistic (like many of these types of media articles) because it takes one case and extrapolates wildly to the whole country. When you look at the averages, reality sinks in!

Z

[Jimefam]

wealthier (upper middle class) people do pay proportionally less tax than middle tax workers, unless they simply don't understand the system.

This is a true statement. All the math in the world doesn't change this. To use the warren buffet example. His sec makes 60k a year and pays 30% he made 46 mil and paid 17.7%. Which means he paid a lower % of taxes on total gross income. I can see how your confused yes he paid $8,142,000 while she paid $18k but as stated before what is discussed is percentage of income. Of course the wealthy pay more overall taxes the income is much higher. You are correct in all your math except that is not the ? at hand. What he means to say is that the sec making 60 and giving up 18 has a much harder time surviving than buffet making 46 mil and giving up 15 mil which would be at the same 30% if we had a flat tax. No arguing that but since i'm not a communist I dont see why the more productive should pick up the slack of the least. And chill out with the big letters and agression that is usually that first sign of a weak argument.

[szh]

To use the warren buffet example. His sec makes 60k a year and pays 30% he made 46 mil and paid 17.7%. Which means he paid a lower % of taxes on total gross income. I can see how your confused yes he paid $8,142,000 while she paid $18k but as stated before what is discussed is percentage of income.

Of course! My point was that a single example does not constitute a whole. Look at the actual percentages in what I posted to see the whole for the country ... it makes a lot more sense to look at the averages (not individual specific cases).

And chill out with the big letters and agression that is usually that first sign of a weak argument.

1. My point with the bold letters is to draw your attention to what I want you to focus on since it is a long post - with lots of numbers and the like.

2. I apologize if you think it is aggressive in tone, but I find it quite frustrating to see uninformed posts (plenty of examples here and in other threads) made by many people who don't look at facts and insist on pushing their Socialist agenda. I respond strongly to those kinds of sillinesses.

But, your comment that this is a sign of a weak argument is devoid of any reality or fact. Regardless, I will go edit it and tone down the size - if that is what you are complaining about!

Z

[szh]

wealthier (upper middle class) people do pay proportionally less tax than middle tax workers, unless they simply don't understand the system.

This is a true statement.

Sorry, no. This is simply not borne out by the data - that is the myth that you guys need to let go of! Look at what I posted carefully. In terms of percentages, it is proportionally higher tax too, by the wealthier people.

Here are the facts:

1. The bottom 20% of wage earners paid 4.3% of their income in taxes.2. The next 20% of wage earners paid 9.9% of their income in taxes.3. The next 20% of wage earners paid 14.2% of their income in taxes.4. The next 20% of wage earners paid 17.4% of their income in taxes.5. The top 20% of wage earners paid 25.5% of their income in taxes.

Z

[ishkabibble]

ish those tax rates are not only decieving they are very out of date

Wrong on both counts:

1. This data is directly from the CBO and IRS. How is it deceptive?

2. At worst, the data is 1 year out of date. Accurate government data usually trails the current date by about 2 years. Even if we could get some "live" numbers, what changed so drastically in the past 3 years that the numbers are going to change significantly?

[rn79870]

Actually, I would prefer that you did go into detail. Because, I am confident you are incorrect. This is an old myth that has no basis in reality.

My wife has an MBA and does taxes for people - working for HR Block as a seasonal tax preparer - and she knows the facts and agrees with me! She is a registered Democrat, by the way, and is planning on voting for Obama for sure - politics are a fun discussion at our house.

Z

I was going to post a personal example regarding a living Instead, I'll give a general description of how it works.

The trust splits income, especially income produced from assets, into a different taxable entity. The trustee still owns that entity, yet it reports it's income as if it were an individual. Now, the individuals income, and the trust income are two entities, and the tax bracket of each is at a lower percentage than the percentage it would be at if they were combined. Hence, less taxes are paid proportionately.

Not to mention that the trust income has a different set of write offs than the personal income would be entitled to.

These "loopholes" are well known to the wealthy as they are the class of people who can afford the financial planners and accountants and the attorneys necessary to take advantage of these things.

So yes, the more wealthy people do (unless they haven't got a clue) pay proportionately less taxes than the less well to do. No one said they don't pay any taxes, however, with proper tax shelter planning that is a real possibility. I know business owners who buy, rather lease, for their business merely because of the tax incentives, not because they need that specific item.

[szh]

So yes, the more wealthy people do (unless they haven't got a clue) pay proportionately less taxes than the less well to do.

You are simply not really looking at the data above (as ishkabibble points out, it is from the CBO). Please take the time to sit back, with an open mind, and understand what this data shows!

"Proportion" means the same thing as "percentage". Look at this part of my posted calculation again specifically:

1. The bottom 20% of wage earners paid 4.3% of their income in taxes.2. The next 20% of wage earners paid 9.9% of their income in taxes.3. The next 20% of wage earners paid 14.2% of their income in taxes.4. The next 20% of wage earners paid 17.4% of their income in taxes.5. The top 20% of wage earners paid 25.5% of their income in taxes.

As you go up the "wealth" chain, the percentage of their total income that the rich people paid goes up.

As an average across the country - not a specific individual case or two that might have it different.

Nothing to do with being clueless ... has to do with graduated income tax rates, the effects of AMT, etc., etc., etc.

Z

[rn79870]

But the writeoffs/shelters knock a #4 to a #3 or even a #2.

[szh]

But the writeoffs/shelters knock a #4 to a #3 or even a #2.

Huhn ... what does that mean?

The percentages in my post are based on actual IRS collections - as reported by the CBO.

Z

[smockers83]

Warren Buffet pays less tax because he donates boat loads of cash to charities and foundations. That's just like writing off business expenses on your 1099.