Still Hating America.

[Gattigap]

Originally posted by bi-partisanship fairy
In the spirit of bi-partisanship I support the concept of fair and bi-partisan reform, but, I am curious, what definition of "flat" are they using? Any citations for it?

Did we ask for definitions of "patriot"?

[taxwonk]

Originally posted by sebastian_dangerfield
Dude, you cannot raise the cap gains rate for everyone. Chasing Steve Schwartzman will wind up nailing a whole shitload of non-rich doctors, lawyers and small business owners. If that is to happen, it has to be graduated so that the current low rate remains up to $5 mil in income, then incrementally goes up.

Yeh, I know that sounds high, but this is not a socialist nation.

Why?

[taxwonk]

Originally posted by bi-partisanship fairy
In the spirit of bi-partisanship I support the concept of fair and bi-partisan reform, but, I am curious, what definition of "flat" are they using? Any citations for it?

A far more equitable definition than that of the people advocating a "flat tax" that doesn't tax anything other than earned income. And you'll also note that I included a disclaimer that it was a flatter than we have now tax, not a literally flat tax.

[taxwonk]

Originally posted by bi-partisanship fairy
What definition of "permanent" are you using?

I mean permanent as opposed to Bush's trick of lowering the top rate but having the provision expire the year after he leaves office.

[Cletus Miller]

Originally posted by Mmmm, Burger (C.J.)
2) about 16%.

More like 19% (of AGI), based on 2004 (most recent year available, and 36.9% of Income Tax--see http://www.irs.gov/newsroom/article/...168554,00.html

What I haven't ever seen is the same break down for total federal tax burden--including FICA and medicare taxes. It all goes into the same budget, so why focus only on income tax?

[captain marvelous]

Hello,

It's been a while since I checked in to this sinkhole. Generally stayed away from politics for a while. Too depressing, but I had an experience this morning that gives me hope for a new day.

I have the misfortune of living in a state that is more red than blue, although my city is purplish. This morning I was at the Dunkin Donuts, and a young woman with a cute toddler was waiting in line behind me. A middle aged man got in line behind her and asked how old her son was. She answered he was 13 months but big for his age and that she and her husband were figuring someday he might be a linebacker. The man replied that's a good ambition, but perhaps he should reach for the stars and aspire to be President someday. Without missing a beat the young mother said, "No, I don't think so. The American people seem to think that's a job for a stupid person and my son is quite smart." The man laughed and said, "Yep we've got a moron at the helm. Maybe the American people will wake up and vote for someone up to the job next time. Sure hope so for the sake of our kids."

I had quite a chuckle listening to that, but on reflection I realized that it was an important marker in our current political consicousness. If strangers have no qualms about openly dissing the Moron-in-Chief in a public place, the tide of public opinion has indeed turned. There was a long line in that place. Both people could be heard by everyone, and not one person spoke up to defend Bush. It was truly a wonderful moment and portends well for 2008.

Virginia Tech and the continuing quagmire in Iraq aside, I feel a little bit better about being an American today. I hope the same for all of you.

-Captain M

[taxwonk]

Originally posted by Mmmm, Burger (C.J.)
1) The top AMT rate is well below 35%. That's why the richest don't pay it.

2) about 16%.

According to the SOI Bulletin for 2003, the last year for which full studies are available, the top 1% of return filers earned somewhere near the top of the $200-500 thousand dollar income bracket. Collectively, they reported AGI of $1,352,551,228. This represents about 22% of the total AGI reported for 2003.

I'd imagine that a lot of that disparity will be eaten up by the top 1 percent's disproportionate enjoyment of the remaining tax preferences. But even if it isn't, I've always acknowledged that I'm a fan of progressive taxation. I'm also in favor of a flatter system with a lot less complexity.

[Mmmm, Burger (C.J.)]

Originally posted by Cletus Miller
What I haven't ever seen is the same break down for total federal tax burden--including FICA and medicare taxes. It all goes into the same budget, so why focus only on income tax?

FICA at least comes back in rough proportion to what you pay in, so it's at least reasonable to exclude it. Not saying it wouldn't be interesting to see it in there. On the other hand, since everyone pays it, including the top 1%, the percentages shouldn't shift greatly as a result.

[Mmmm, Burger (C.J.)]

Originally posted by taxwonk
According to the SOI Bulletin for 2003, the last year for which full studies are available, the top 1% of return filers earned somewhere near the top of the $200-500 thousand dollar income bracket. Collectively, they reported AGI of $1,352,551,228. This represents about 22% of the total AGI reported for 2003.

What I find rather intriguing is that from 1986 to 2004, the share of taxes paid by the top 1 percentile of income earners increased from 25% to 37%. Source (IRS excel table)

[Tyrone Slothrop]

Originally posted by Mmmm, Burger (C.J.)
What I find rather intriguing is that from 1986 to 2004, the share of taxes paid by the top 1 percentile of income earners increased from 25% to 37%. Source (IRS excel table)

How does that compare to the shift in the share of income earned by the top percentile in that same period?

[ltl/fb]

Originally posted by Mmmm, Burger (C.J.)
FICA at least comes back in rough proportion to what you pay in, so it's at least reasonable to exclude it. Not saying it wouldn't be interesting to see it in there. On the other hand, since everyone pays it, including the top 1%, the percentages shouldn't shift greatly as a result.

Medicare never cuts off on wages, but the OASDI part does cut off -- so, people making above the wage base pay proportionately less of their income in OASDI. It's like how people who are right around a marginal cutoff pay an effective tax rate much lower than their marginal rate, but people who make a buttload of money really do end up paying around 35% because the lower rates on the first part of their incomes just disappear.

So, someone with wages under about $100k pays about 6% in OASDI, someone making $585k pays 1% in OASDI, and someone making $5m pays about 0.1% -- a vanishingly small amount. So if you're at the lower end of the income scale and your effective income tax rate is 18%, and Rupert Murdoch is at the higher end of the income scale and his effective income tax rate is 35%, when OASDI is factored in, you are really at 24% and he's still at 35%. Or 35%.

I think the point is that when we compare the overall effective federal tax rate on shmoes to big dogs, there's a 6%ish differential that isn't always considered. And while in theory we are all going to get out according to what we put in -- I don't think that's really a realistic expectation at this point. It's treated as one big pot of money.

[bi-partisanship fairy]

In the spirit of bi-partisanship, on this holiest of days, let's disclose our respective effective tax rates for 2006.


Who's in?

[Mmmm, Burger (C.J.)]

Originally posted by Tyrone Slothrop
How does that compare to the shift in the share of income earned by the top percentile in that same period?

12% to 19%.

[Cletus Miller]

Originally posted by Mmmm, Burger (C.J.)
12% to 19%.

19/12=158% increase in income share

37/25=148% increase in tax share

So, the income tax burden of the top 1% relative to their income fell b/t 1986 and 2004. Things aren't getting worse, they're getting better.

Also, what about non-income federal taxes paid by individuals? Like the estate/death tax? What's the trend line on that one?

[captain marvelous]

Hi all,

If I thought I was in a good mood after my DD experience this morn, I never imagined how much happier I could get. The mainstream media, sort of, is now calling for Bush's impeachment.

Today's "Doonesbury" comic comes right out and says it: "Impeach Bush now!"

The strip shows the Mark Slackmeyer character looking at reader e-mails as Mike Doonesbury stands behind him.

One e-mail from "M.R." of Austin says: "What's up with criticizing Bush day after day? Give it a rest already!"

To which Mike responds: "Actually, M.R., we're not as relentless as you think. Despite Iraq, Katrina, wiretapping, torture, etc., in the last year there's only been a total of 55 strips ripping the president!"

Then Mark says "Impeach Bush now!" -- causing Mike to add: "Okay, 56."

"Doonesbury" runs in about 1,400 newspapers via Universal Press Syndicate.

I am thinking critical mass can take hold with enough of this. Realistically, can we bring this fool down?