Whats wrong with this Country

[pizzaman]

We all know it. We all see it. And we are all going to feel it. So why are our elected politicians doing anything about it?

WASHINGTON – As millions of procrastinators scramble to meet Monday's tax filing deadline, ponder this: The super rich pay a lot less taxes than they did a couple of decades ago, and nearly half of U.S. households pay no income taxes at all.

The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992.

Over the same period, the average federal income tax rate for all taxpayers declined to 9.3 percent from 9.9 percent.

The top income tax rate is 35 percent, so how can people who make so much pay so little in taxes? The nation's tax laws are packed with breaks for people at every income level. There are breaks for having children, paying a mortgage, going to college, and even for paying other taxes. Plus, the top rate on capital gains is only 15 percent.

There are so many breaks that 45 percent of U.S. households will pay no federal income tax for 2010, according to estimates by the Tax Policy Center, a Washington think tank.

"It's the fact that we are using the tax code both to collect revenue, which is its primary purpose, and to deliver these spending benefits that we run into the situation where so many people are paying no taxes," said Roberton Williams, a senior fellow at the center, which generated the estimate of people who pay no income taxes.

The sheer volume of credits, deductions and exemptions has both Democrats and Republicans calling for tax laws to be overhauled. House Republicans want to eliminate breaks to pay for lower overall rates, reducing the top tax rate from 35 percent to 25 percent. Republicans oppose raising taxes, but they argue that a more efficient tax code would increase economic activity, generating additional tax revenue.

President Barack Obama said last week he wants to do away with tax breaks to lower the rates and to reduce government borrowing. Obama's proposal would result in $1 trillion in tax increases over the next 12 years. Neither proposal included many details, putting off hard choices about which tax breaks to eliminate.

In all, the tax code is filled with a total of $1.1 trillion in credits, deductions and exemptions, an average of about $8,000 per taxpayer, according to an analysis by the National Taxpayer Advocate, an independent watchdog within the IRS.

More than half of the nation's tax revenue came from the top 10 percent of earners in 2007. More than 44 percent came from the top 5 percent. Still, the wealthy have access to much more lucrative tax breaks than people with lower incomes.

Obama wants the wealthy to pay so "the amount of taxes you pay isn't determined by what kind of accountant you can afford."

Eric Schoenberg says to sign him up for paying higher taxes. Schoenberg, who inherited money and has a healthy portfolio from his days as an investment banker, has joined a group of other wealthy Americans called United for a Fair Economy. Their goal: Raise taxes on rich people like themselves.

Shoenberg, who now teaches a business class at Columbia University, said his income is usually "north of half a million a year." But 2009 was a bad year for investments, so his income dropped to a little over $200,000. His federal income tax bill was a little more than $2,000.

"I simply point out to people, `Do you think this is reasonable, that somebody in my circumstances should only be paying 1 percent of their income in tax?'" Schoenberg said.

Sen. Orrin Hatch of Utah, the top Republican on the Senate Finance Committee, said he has a solution for rich people who want to pay more in taxes: Write a check to the IRS. There's nothing stopping you.

"There's still time before the filing deadline for them to give Uncle Sam some more money," Hatch said.

Schoenberg said Hatch's suggestion misses the point.

"This voluntary idea clearly represents a mindset that basically pretends there's no such things as collective goods that we produce," Schoenberg said. "Are you going to let people volunteer to build the road system? Are you going to let them volunteer to pay for education?"

The law is packed with tax breaks that help narrow special interests. But many of the biggest tax breaks benefit millions of American families at just about every income level, making them difficult for politicians to touch.

The vast majority of those who escape federal income taxes have low and medium incomes, and most of them pay other taxes, including Social Security and Medicare taxes, property taxes and retail sales taxes.

The share of people paying no federal income tax has dropped slightly the past two years. It was 47 percent for 2009. The main difference for 2010 was the expiration of a tax break that exempted the first $2,400 of unemployment benefits from taxation, Williams said.

In 2009, nearly 35 million taxpayers got a tax break for paying interest on their home mortgages, and nearly 36 million taxpayers took the $1,000-per-child tax credit. About 41 million households reduced their federal income taxes by deducting state and local income and sales taxes from their taxable income.

About 36 million families cut their taxes by nearly $35 billion by deducting charitable donations, and 28 million taxpayers saved a total of $24 billion because their income from Social Security and railroad pensions was untaxed."As a matter of policy, there would be a lot of ways to save money and actually make these things work better," said Leonard Burman, a public affairs professor at Syracuse University. "As a matter of politics, it's really, really difficult."

Edited April 18, 2011 by pizzaman

[BanG]

This is why we are BROKE. The tax laws need to be reformed and fairly set according to your income. It is a joke when a company like GE pays no taxes because of loop holes on 14billion dollars????? JMO. Peace.

[GreginTexas]

There should be NO income tax period.

If the nation can not be run with the import taxes charged on goods coming into this country. Then a sales or user tax for all should be put in. By that is meant individuals, millionaires, poor, and corporations pay the same. There can still be exemptions for food, medicine etc. No more manipulating the tax codes to just get votes for the politicians. The more you earn the more you keep and the more you spend the less you have. Great concept, right. This is a rough example of the FAIR TAX. By the way I have not nor do I know of anyone that has been hired by a poor man. The wealthy earn their money and have a right to keep or spend it just as you.

GreginTexas

“The inherent vice of capitalism is the unequal sharing of blessings.

The inherent virtue of socialism is the equal sharing of miseries.”

Winston Churchill

[Dalite]

A progressive Income Tax is a long ride on the road to Socialism.

A Flat Tax, in which all paid the same rate, based on consumption would be a good place to start.

All this article does is to promote class warfare.

I'm not thrilled about GE being able to herd elephants through IRS loopholes.

I am even less thrilled by the IRS.

Let the states collect the flat tax, keep what the state needs, then send the rest.to DC.

Washington DC isn't even a part of the US. Let them generate their own revenue.

Keep them broke, and out of trouble.

Abolish The IRS and their employer; the Federal Reserve.

[jaykay]

FLAT TAX s the way

[caz1104]

Numbers can be decieving. The top 4% pay 40% of all taxes while the bottom 47% pay zilch, now tell me who doe'nt pay enough in taxes. While I'll agree there are way to many tax loopholes, to me a consumption tax seems the fairest way to ensure all americans pay there fair share. Abolish the IRS would be a great start imo.......................GO RV 2011 BABY!!!!

[Lutie]

There should be NO income tax period.

If the nation can not be run with the import taxes charged on goods coming into this country. Then a sales or user tax for all should be put in. By that is meant individuals, millionaires, poor, and corporations pay the same. There can still be exemptions for food, medicine etc. No more manipulating the tax codes to just get votes for the politicians. The more you earn the more you keep and the more you spend the less you have. Great concept, right. This is a rough example of the FAIR TAX. By the way I have not nor do I know of anyone that has been hired by a poor man. The wealthy earn their money and have a right to keep or spend it just as you.

GreginTexas

“The inherent vice of capitalism is the unequal sharing of blessings.

The inherent virtue of socialism is the equal sharing of miseries.”

Winston Churchill

Thank you! We should all be out on the street demanding tax reform.

[GreginTexas]

Thank you!  We should all be out on the street demanding tax reform.

Great ---- get together -- where and when ---- I will be thereGreginTexas

[BanG]

I certainly support a FLAT tax. Simple, clean and everybody gets paid in the gov to do their job. Peace.

[Tom73]

Fair Tax or Flat Tax and Term limits on the politiicans.

We do not need a "Change to failure"!!!!!!!!!!!!

[DAME1]

REALLY ??????

It's funny that same old story about the evil rich.....not doing enough ...does it ever occur to anyone that when the government can't get more of your money the first thing they cut are the poor the elderly and the helpless? Then they blame it on the wealthy....This particular party has been singing this song for over 50 years and people are still buying into it. How about this.

Take the wealthy out of the equation and see what you got? No better yet let's go see if there's more water on the moon. Yeah that's money well spent.....I mean REALLY........ :unsure:

[DaveJen]

I would suggest that we not have an income tax but rather a flat sales tax. Then we would not be taxed on what we earn but rather what we spend. This would be the most fair way. Do away with all taxes except the sales tax. No income tax, no property tax, etc. Then if you are smart and save, you will truly start to accumulate wealth. Also remember it is those big bad evil wealthy people who create take the risk and create the jobs you need. For every government job created it cost no less than 5 private sector jobs and does not create wealth. Instead it takes wealth away from us. We are not underpaid - we are overtaxed.

[MrRich]

The wealthiest 1 percent of the population earn 19 per­cent of the income but pay 37 percent of the income tax. The top 10 percent pay 68 percent of the tab. Meanwhile, the bottom 50 percent—those below the median income level—now earn 13 percent of the income but pay just 3 percent of the taxes. Nuff said.

[Heavyduty053]

We all know it. We all see it. And we are all going to feel it. So why are our elected politicians doing anything about it?

WASHINGTON – As millions of procrastinators scramble to meet Monday's tax filing deadline, ponder this: The super rich pay a lot less taxes than they did a couple of decades ago, and nearly half of U.S. households pay no income taxes at all.

The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992.

Over the same period, the average federal income tax rate for all taxpayers declined to 9.3 percent from 9.9 percent.

The top income tax rate is 35 percent, so how can people who make so much pay so little in taxes? The nation's tax laws are packed with breaks for people at every income level. There are breaks for having children, paying a mortgage, going to college, and even for paying other taxes. Plus, the top rate on capital gains is only 15 percent.

There are so many breaks that 45 percent of U.S. households will pay no federal income tax for 2010, according to estimates by the Tax Policy Center, a Washington think tank.

"It's the fact that we are using the tax code both to collect revenue, which is its primary purpose, and to deliver these spending benefits that we run into the situation where so many people are paying no taxes," said Roberton Williams, a senior fellow at the center, which generated the estimate of people who pay no income taxes.

The sheer volume of credits, deductions and exemptions has both Democrats and Republicans calling for tax laws to be overhauled. House Republicans want to eliminate breaks to pay for lower overall rates, reducing the top tax rate from 35 percent to 25 percent. Republicans oppose raising taxes, but they argue that a more efficient tax code would increase economic activity, generating additional tax revenue.

President Barack Obama said last week he wants to do away with tax breaks to lower the rates and to reduce government borrowing. Obama's proposal would result in $1 trillion in tax increases over the next 12 years. Neither proposal included many details, putting off hard choices about which tax breaks to eliminate.

In all, the tax code is filled with a total of $1.1 trillion in credits, deductions and exemptions, an average of about $8,000 per taxpayer, according to an analysis by the National Taxpayer Advocate, an independent watchdog within the IRS.

More than half of the nation's tax revenue came from the top 10 percent of earners in 2007. More than 44 percent came from the top 5 percent. Still, the wealthy have access to much more lucrative tax breaks than people with lower incomes.

Obama wants the wealthy to pay so "the amount of taxes you pay isn't determined by what kind of accountant you can afford."

Eric Schoenberg says to sign him up for paying higher taxes. Schoenberg, who inherited money and has a healthy portfolio from his days as an investment banker, has joined a group of other wealthy Americans called United for a Fair Economy. Their goal: Raise taxes on rich people like themselves.

Shoenberg, who now teaches a business class at Columbia University, said his income is usually "north of half a million a year." But 2009 was a bad year for investments, so his income dropped to a little over $200,000. His federal income tax bill was a little more than $2,000.

"I simply point out to people, `Do you think this is reasonable, that somebody in my circumstances should only be paying 1 percent of their income in tax?'" Schoenberg said.

Sen. Orrin Hatch of Utah, the top Republican on the Senate Finance Committee, said he has a solution for rich people who want to pay more in taxes: Write a check to the IRS. There's nothing stopping you.

"There's still time before the filing deadline for them to give Uncle Sam some more money," Hatch said.

Schoenberg said Hatch's suggestion misses the point.

"This voluntary idea clearly represents a mindset that basically pretends there's no such things as collective goods that we produce," Schoenberg said. "Are you going to let people volunteer to build the road system? Are you going to let them volunteer to pay for education?"

The law is packed with tax breaks that help narrow special interests. But many of the biggest tax breaks benefit millions of American families at just about every income level, making them difficult for politicians to touch.

The vast majority of those who escape federal income taxes have low and medium incomes, and most of them pay other taxes, including Social Security and Medicare taxes, property taxes and retail sales taxes.

The share of people paying no federal income tax has dropped slightly the past two years. It was 47 percent for 2009. The main difference for 2010 was the expiration of a tax break that exempted the first $2,400 of unemployment benefits from taxation, Williams said.

In 2009, nearly 35 million taxpayers got a tax break for paying interest on their home mortgages, and nearly 36 million taxpayers took the $1,000-per-child tax credit. About 41 million households reduced their federal income taxes by deducting state and local income and sales taxes from their taxable income.

About 36 million families cut their taxes by nearly $35 billion by deducting charitable donations, and 28 million taxpayers saved a total of $24 billion because their income from Social Security and railroad pensions was untaxed."As a matter of policy, there would be a lot of ways to save money and actually make these things work better," said Leonard Burman, a public affairs professor at Syracuse University. "As a matter of politics, it's really, really difficult."

My solution to this is and always has been to abolish the current tax system and go to a CONSUMPTION tax that would be assested on whatever we buy. Tx rates would be set on amount of purchase no matter if it was a piece of bubble gum or a house. There would not be a state tax or federal tax and the IRS dept could be downsized therfore costing less as a dept to run. No one would be exempt. Tax exempt status could be reduced for the poor by showing proof of their income to get a ID card. You and i would pay our fair share of consumption tax on every purchase. I my thinking this would bring the tax cheats, the aliens, the wealthy more into line and create a little fairness to the system. Congressman will not offer a bill for this because the wealthy pump millions into their war chest for reelection therefore creating promises of favors that have to be payed back........Just think for a minute......In our govt budget decisions each year have you ever heard one congressman mention cutting congress salary to help. Have you ever heard them mention cutting foreign aid to countries that don' need it. NO, NO, No its always social security, medicare, welfare programs to help the less forniunate. Now i agree that there are people that draw welfare that should be working but if they draw a govt check they should be required to take a drug test once a month. Our govt gives money away everyday and has been for years. Until the american people get behind and push and demand a fair tax it will not happen. Congress is not concerned with us, and they sure aren't scared of the vote because they go right back to washington as a lobbyist and they know it. Double dipping, payoffs, under table money. How a great a govt we have.....Land of the free and home of the taxes..

[Mongo]

This country ran for 160 years on tariffs without ANY income tax.

The income tax was to be temporary for war debt. It was NEVER to become permanent.

The tax code is just a giant mess. No 2 can agree on what is the right tax for the dinar RV.

The current tax code is based on profit or making money.

This allows the big corps to pay ZIP! They dock the transport ships along the way here. The goods are sold and bought on paper in that port. Then when sold here there is no profit and they pay nothing!

Ford Motor Com figured that one out long ago because a tax rip off ina foriegn country.

Putiing in tariffs paid right there on the dock would end the loop hole and the foreign corps would have to pay then.

IMO I don't think it's any biz of the Gov how much we make. That's OUR biz not thiers.

It's a simple matter of set the tariff rate to pay for the Fed Gov.

Think of how much more we could do with the tax money we pay now and add to that using all the time we spend doing paperwork. That gets added back into our earning time!

Thats right..................The GOV. made no provision to make US citizens pay federal taxes, just state tax. There was a good reason for that, to keep the fed Gov. from turning into a monster that it is today

[Kenneth]

We can't get a flat tax until we get rid of the Dems and Obomination; but the Republican budget plan with tax reforms is a step in the right direction.

[On_Reserve]

The wealthiest 1 percent of the population earn 19 per­cent of the income but pay 37 percent of the income tax. The top 10 percent pay 68 percent of the tab. Meanwhile, the bottom 50 percent—those below the median income level—now earn 13 percent of the income but pay just 3 percent of the taxes. Nuff said.

... and for further perspective: http://markmaynard.com/?p=11169

Both sides need to be understood. Why would some of the top 1% now start mobilizing toward letting the (majority) of the Bush tax cuts to expire? Hmmmm ... ?? Isn't this against their best interest?

TS

I believe in the RV; I don't believe in the cult.