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Author: KillroyFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121571  
Subject: My back hurts- Rant Date: 9/30/2009 9:08 PM
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My back has been acting up lately. It's never really caused me any trouble but recently it feels like I'm always carrying a heavy weight on my shoulders. I didn't go to the doctor but I did find the cause of my pain. Little did I know that I was carrying another person on my solders and you probably are too. It's estimated that 47% of all US households will pay no federal taxes in 2009. That means that if your paying, your covering your share as well as the person next to yous share.

http://money.cnn.com/2009/09/30/pf/taxes/who_pays_taxes/inde...

This isn't really news to me, but the growing gap between payers and non payers is alarming. At some point those that are paying are likely to throw in the towel, quite their high paying jobs and let the rest fend for themselves. If enough do that, the whole system collapses.

I understand and to a point agree that those that can, should help those that can't, but come on. When almost 50% are in the "can't" category there is a problem.

With a rising deficit, a raging heath care debate (about how we care for more people on my dime), and facing social security becoming insolvent if changes aren't made, the time to action has come.

Are you going to take the fight to Washington to force changes, or throw in the towel?

This country was founded on many principles, one being no taxation without representation. Is it time to change that to no representation with paying your taxation?
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Author: bookie71 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107240 of 121571
Subject: Re: My back hurts- Rant Date: 10/1/2009 11:43 AM
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I remember when (I'm an old f@#t) clients used to come in and ask, "When do I stop working?" Rates went to about 90%

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Author: dusty2004 Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107241 of 121571
Subject: Re: My back hurts- Rant Date: 10/1/2009 11:54 AM
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KillroyFool:

I am sure that many on this board can relate to much of what you are saying this is really just a board to ask a tax related question. There are many boards on the Fool to discuss politics.

Dusty

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Author: bookie71 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107242 of 121571
Subject: Re: My back hurts- Rant Date: 10/1/2009 12:07 PM
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Dusty,
I agree, BUT if you are p;anning your taxes, you need to be aware of what all the government (both Bush and Obama) spending could do to tax rates in the future.

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Author: aj485 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107243 of 121571
Subject: Re: My back hurts- Rant Date: 10/1/2009 1:23 PM
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I agree, BUT if you are p;anning your taxes, you need to be aware of what all the government (both Bush and Obama) spending could do to tax rates in the future.

The discussion on what will happen with rates in the future can be had without the political rant.

Something like "The deficits that have been/are being incurred will probably not be able to be paid with current tax revenues, so it is likely that taxes paid will have to increase in the future." See - no politics, or ranting about people paying/not paying, etc.

The post that started this thread would be more appropriate on PA - where it was also posted by the OP.

AJ

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Author: brucedoe Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107247 of 121571
Subject: Re: My back hurts- Rant Date: 10/1/2009 8:44 PM
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The answer to the problem of all those paying no Federal income tax is obvious: INCREASE THEIR WAGES!

brucedoe

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Author: Donna405 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107248 of 121571
Subject: Re: My back hurts- Rant Date: 10/1/2009 10:56 PM
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I remember, when I was preparing taxes at Jackson-Hewitt, from tax years 2002-2008, I had many lower-income persons as my clients. Many of these people claimed children, which I know were not their children. I had them sign a statement that these children were legally being claimed, as a CYA for me. These are people who paid no taxes. Many of the people would work just long enough to be able to collect the maximum EIC, and then would quit work, until the following year.

I am so fed up with the "fraud", that I will not be preparing those taxes this coming tax year, and have advised J-H of this. I will prepare taxes for friends who are honest and hard-working, as a favor.

The system is broken and I don't know of a way to fix it, other than stopping EIC.

What are your thoughts?

Donna

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Author: stockmover Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107249 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 12:29 AM
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The system is broken and I don't know of a way to fix it, other than stopping EIC.


Hi Donna

I read your post with great interest. My DW has worked for state government for over 20 years in the department which administers food stamps, cash assistance, medical assistance etc. While she is well aware(she is not naive) of fraud in all government programs ... at all levels, she also knows there are many folks who are truly in need of EIC and other government provided benefits. So as I see it ... you have the option to directly report these individuals to the IRS who are fraudulently qualifying for these benefits. I know this is not always an easy task especially if your temporary employer (J-H) condones this fraud to increase it's bottom line. In fact, it probably would lead to your termination ... but it may very well put a very small dent in these fraudulent tax filings. It may also give you a sense of pride in trying to eliminate welfare program abuse. But only you alone can make that call Donna. It's a tough one.

Over the years I myself have been pondering all the horrendous abuse of government programs from food stamps to Medicare/Medicaid etc and I came up with something I believe just may work ... not a 100% of course but at least a start.
I would like to see the General Accounting Office in conjunction with the Inspector Generals Office hire a large task force of well qualified accountants/auditors who would independently report to an Obama Cabinet member (maybe even a new Cabinet Position) and be assigned to audit "high risk" government programs, which is to say, the ones which have the highest exposure to fraud and abuse. Each accountant auditor would be paid a base salary of $50,000/year .... but here is the kicker ... they would ALSO receive an incentive of 10% of the savings they could save the Feds with the implementation of new Policies & Procedures along with Legislative action to reduce if not eliminate the loopholes and abuse within the government programs.
I know that calculating the PROJECTED and ACTUAL savings may very well be problematic but hey ... it's a start. Also, I believe the 10% incentive would sure as hell help to insulate these employees from bribery and corruption because they would know the $$$$$$ they can earn via this incentive.
I know some of you Fools might say this is not the board to post this, but I was just giving my "rant" in response to Donna's post.
Any thoughts on my proposals?
Thanks for listening Fools.

~TG~

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Author: Donna405 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107250 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 12:38 AM
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Stockmover: I would like to see the General Accounting Office in conjunction with the Inspector Generals Office hire a large task force of well qualified accountants/auditors who would independently report to an Obama Cabinet member (maybe even a new Cabinet Position) and be assigned to audit "high risk" government programs, which is to say, the ones which have the highest exposure to fraud and abuse. Each accountant auditor would be paid a base salary of $50,000/year .... but here is the kicker ... they would ALSO receive an incentive of 10% of the savings they could save the Feds with the implementation of new Policies & Procedures along with Legislative action to reduce if not eliminate the loopholes and abuse within the government programs.

It would be lovely to have such a task force. However, the only way to stop it is for such persons to personally visit the homes of those who appear to be fraudulent, require proof on the spot that those children are theirs and take it from there. As I stated, I had many of those claiming children, who I felt were not theirs and not properly claimed (i.e., proper dependent), sign a statement that these children are being properly claimed and that they could produce evidence of such if the IRS demands it.

As an example, one woman claimed she was not married, had a "child-care business" in her home and collected the maximum EIC, when I knew she was married and one of the children she claimed was neither hers or her husband's child. I had her sign a statement that she is not married and all children claimed are properly claimed, etc.

Last year, I was conveniently absent when she appeared for the preparation of her taxes (I saw her coming and left). Another individual prepared her taxes and did not allow her to claim all the children, since she could not produce proof. However, she told him she was not married and still collected the EIC. He did have her sign a statement as I did. She was very upset, so much so, she later came to me to see if I could fix it. I told her "no", and that she would have to go with what Charlie did. I talked with Charlie and told him "good job", since I am the one who trained him (he turned out to be the star of the company as a 1st year preparer.)

Would you believe, in the tax year that the rebate of $300 to whatever was given, I had two guys come who wanted to claim their dogs!!! Then, they wanted to claim their nephews, when they made less than $3,000 per year. I asked both of them how could they support themselves, a dog and a child, on less than $3,000 per year. They left.

Donna

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Author: snippee Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107251 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 12:48 AM
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they would ALSO receive an incentive of 10% of the savings they could save the Feds with the implementation of new Policies & Procedures along with Legislative action to reduce if not eliminate the loopholes and abuse within the government programs.


My fear would be that an auditor could find a way to classify a legitimate, beneficial program as bad, shut it down just to increase his/her bonus. I'd like more information on how "abuse" and "loopholes" will be defined (and who will be the ones defining them) before condoning or condemning the idea.

My take is this: There will always be people out to defraud. And while we should do whatever we can to stop them, we shouldn't do so at the expense of the rest of the (honest) ones who benefit from and deserve the help the programs give.

My anecdotal EITC evidence is the opposite of Donna's - i had heard so many stories about "crooks" during my training. However, my clients (at HRB) appeared to be the opposite - hardworking people, trying to get ahead and grateful for the small amount of help EITC provided. A few of them in later years were even pleased to learn they no longer qualified because their hard work had paid off in higher wages.

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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107254 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 4:01 AM
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I don't know of a way to fix it, other than stopping EIC.

What are your thoughts?


My first is that I'm sad to learn that you prepared returns that you thought were fraudulent. I'm hoping you were in desperate financial straits, and that's what led you to a life of crime. Glad to see you finally decided to be an honest person, but you'll forgive me if I don't share your outrage about other people who cheat while giving yourself a pass with a CYA piece of paper.

As for the EIC, it's a welfare program being administered through the tax system. There's a reason nature doesn't allow species to cross certain lines in procreation, and this program has had problems from the beginning.

IRS does more than I suspect you realize in weeding out fraudulent EIC claims. Through VITA I've seen people who were legitimately claiming the credit have to go through all sorts of compliance inquiries from the IRS.

I think Congress ought to be able to come up with a better system of getting money to these people, but I can't offer any suggested methods.

Phil
Rule Your Retirement Home Fool

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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107255 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 4:16 AM
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I would like to see the General Accounting Office in conjunction with the Inspector Generals Office hire a large task force of well qualified accountants/auditors who would independently report to an Obama Cabinet member (maybe even a new Cabinet Position) and be assigned to audit "high risk" government programs, which is to say, the ones which have the highest exposure to fraud and abuse. Each accountant auditor would be paid a base salary of $50,000/year .... but here is the kicker ... they would ALSO receive an incentive of 10% of the savings they could save the Feds with the implementation of new Policies & Procedures along with Legislative action to reduce if not eliminate the loopholes and abuse within the government programs.

I think you overestimate the abilities of these $50,000 auditors.

I started working for the IRS when Nixon was President, and every White House through Clinton's, during which I retired, had at least one major FWA (fraud, waste, abuse) initiative. It's also a favorite of Congress when they're looking for some budget numbers to gin up to "pay for" a spending initiative.

Of course there's some there there, but not nearly what you'd think from the news and anecdotal experience.

Phil
Rule Your Retirement Home Fool

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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107256 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 4:19 AM
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It would be lovely to have such a task force. However, the only way to stop it is for such persons to personally visit the homes of those who appear to be fraudulent, require proof on the spot that those children are theirs and take it from there.

No, that's not the only way. IRS does tons of these through the mail, requiring all sorts of documentation.

Phil
Rule Your Retirement Home Fool

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Author: KillroyFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107258 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 10:02 AM
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There will always be some abuse in any system involving large amounts of money. While there is room for improvement in today's safety net, my bigger concern is with the macro level taxation problem. Simply the federal government (and a few states) are consistently spending more than they have taken in.

We have only to look at a consumer who is over their head in credit card debt to know that continuing to spend and increasing the debt balance while only paying the interest will catch up with you at some point. Currently 8.5% of all money spent buy the federal government is going to pay the interest on the debt. http://en.wikipedia.org/wiki/File:Fy2009spendingbycategory2.... Unlike a consumer it's unlikely that Japan and China (the two biggest holders of US dept at about 20% each) would forgive any portion of that debt.

So at a macro level changes need to be made. While a healthy debate about federal spending could be had, I was suggesting an approach from the income side. A taxing system where only 53% of households are contributing would be a place to start. I'm proud to pay my taxes, but become frustrated when they seem out of balance with others while the country's financial situation continues to deteriorate. The taxation system should not be the mechanism for social engineering. A solution would be to require all people to pay their share of taxes needed to fund all programs. Use the other programs to provide the services.

My apologies if this is slightly off topic for the board on tax strategies, but felt is might be appropriate to discuss the overhaul of the tax system as one strategy. An alternative, micro level strategy, is to throw in the towel, take a lower paying, lower stress job such that you can become one of the 47% of households that don't owe Uncle Sam income tax.

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Author: bookie71 Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107261 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 1:21 PM
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I always liked the idea behind the EIC, it just got too complicated.
Most welfare programs punish someone who tries to better themselves while the idea behind the EIC is that it should encourage folks to work and actually rewards them for trying to better themselves.
Like most programs it just got out of control.
jmho

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Author: Jeanwa Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107262 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 1:47 PM
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An alternative, micro level strategy, is to throw in the towel, take a lower paying, lower stress job such that you can become one of the 47% of households that don't owe Uncle Sam income tax.

This is too funny. So you think people would/should want to give up a higher paying job and become one of the people Donna was talking about that worked only enough to get EIC.

Not me, I'll keep my job and pay the tax. You go ahead and quit your higher paying job and take a lower paying one. I bet there are more people that would step into your job.

I answered your post on the PA board, where I think this thread belongs, but you didn't respond.

http://boards.fool.com/Message.asp?mid=28000034

So I ask again. If you think everyone should pay income tax should people like your in-laws/parents have to pay tax also?

Jean

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Author: katiewa Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107264 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 2:38 PM
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What are your thoughts?

My two cents....

There are lots of regulations and procedures currently in place to control fraud and other crimes. However, I don't think any of us want government bureaucracy to become any more omnipresent (or ridiculous) than it already is. A part of the solution is for the "we, the people" portion of government to take more responsibility. No one wants to be a snitch, but when someone is doing something wrong, we each have a responsibility to talk to that person or talk to someone else who will talk to that person.

(This is along the same lines as all the bullying advice--most people will back down if someone tells them to. Those who don't, you report to a teacher or other authority. There is a certain amount of risk, but since we all claim that our freedom/rights/country are worth fighting and dying for....)

Certainly there are plenty of gray areas--most of those it's probably better to say nothing if you aren't pretty sure. But there are far too many totally obvious things that individuals choose to ignore. (Child abuse is the biggy that comes to my mind, but I don't work in the tax arena.)

Kathleen

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Author: KillroyFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107265 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 3:05 PM
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Jean,

I did respond. I reiterated I feel EVERYONE should pay federal income taxes. Period.

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Author: Wradical Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107266 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 4:12 PM
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The system is broken and I don't know of a way to fix it, other than stopping EIC.
What are your thoughts?
Donna

==================================
You can have fraudulent returns anywhere in the tax system. The EIC does seem awfully popular with the con artist population currently. I think the IRS is on to that, and can cure it with with preventive measures, especially through the e-filing system.

My biggest complaint about the EIC is that it's a public assistance program - heck, call it welfare, that they run through the tax return.
That's not what the tax reporting system is for.

And the rules and limits are WAY too complicated for the low income, otherwise-simple returns that they're connected to. This drives poor people who can't afford it to seek out cut-rate, con-artist tax preparers who talk them into, or help them, pull a scam.

Bill

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Author: brucedoe Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107267 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 4:19 PM
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stockmover

The problem with your solution is that it costs money and more Civil Servants or contractors (who will add fraud of thei own). Increqasing the size of government is not popular, I'm sure you have noticed.

When I was growing up, my father was the Treasurer of an independently owned department store. I questioned him about why there was such a high mark up on items (at least 50%). Among the things he said were that there was a 5% loss from shoplifters and another 5% loss from employees stealing things. Yes, they had store detectives, but this was in spite of that.

For some reason we expect the government to have no waste fraud or abuse, but are willing to accept this in private industry. I've read that the waste fraud and abuse in Meidicare is 7% (I don't know how they know this,.). If so, the percentage amount is not that bad, but the dollar amount is huge. To stamp out this 7% may take that much (more?) in detectives and might wreck the morale of the "atraight arrow" workers. Like the costly check-in procedures now on air flight has taken the joy out of flying.

My wife worked for Westinghouse and executives misuse of expensise accounts was rife. There were worse things that I won't go into as they are a long story. There were two vice-presidents who were forced to retire.

I worked at one time for St. Joseph Lead Company, and the treasurer of their Balmat, New York Division, (America's largest zinc producer at the time) was caught (along with some others) of stealing lumber and other items to build summer homes on the lake. Was he fired? Nope. Had his wrist slapped, but that was all.

And who watches the watch dogs?

brucedoe

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107268 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 5:34 PM
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KillroyFool: "I did respond. I reiterated I feel EVERYONE should pay federal income taxes. Period."

So you do not believe in a standard deduction and personal exemption(s)?

If you do believe in a standard deduction and personal exemptions, there is no way to reconcile your two beliefs.

In fact, I am not sure that a system without a standard deduction and personal exemption(s) woudl pass Constitutionaly muster.

I also doubt your statistics, but I will write separately about that issue.

Regards, JAFO

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107269 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 5:59 PM
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KillroyFool: "It's estimated that 47% of all US households (71 million) will pay no federal taxes in 2009."

From article you cite:

"The vast majority of households making up to $30,000 fall into the category, as do nearly half of all households making between $30,000 and $40,000.

As you move up the income scale the percentages drop.

Nearly 22% of those making between $50,000 and $75,000 end up with no federal income tax liability or negative liability as do 9% of households with incomes between $75,000 and $100,000.

Of course, income taxes don't tell the whole story. Workers are also subject to payroll taxes, which support Social Security and Medicare.

When considering federal income taxes in combination with payroll taxes, the percent of households with a net liability of zero or less is estimated to be 24% this year, according to the Tax Policy Center's estimates."

You really want to have an AGI below $40k???

In addition, how is the Tax Policy Center estimating households?

The Tax Foundation reports 141,071,000 personal income tax returns filed for 2009 (from IRS data). See table 2, http://www.taxfoundation.org/taxdata/show/250.html

If 47% of all US households equals 71 million households, then that implies 151 million plus households!!! 10 million more households than filed returns in 2007. In addition, what about households that file multiple returns, H files MFS, W files MFS, and each of two children who are still dependents file. One household, 4 returns.

I strongly suspect that something is rotten in the state of Denmark WRT to the initial claim about households.

GIGO.

In additon, as the original article notes (in a portion you conveniently ignored), federal income taxes are not the be all and end all of federal taxes. Social Security is effectively an income tax on only earned income, and is flat and ultimately regressive in that the actual rate paid declines as earned income grows past the ceiling; and social security does not tax capital income or or other unearned income.

In other words, if you want to discuss equity in federal tax policy, it is inequitable to focus on only federal income tax.

If you want to discuss equity, why is it equitable for some capital icome (which is unearned), to be taxed at a lower rate than the rate charged on earned income (labor)?

Regards, JAFO

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Author: KillroyFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107270 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 6:42 PM
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JAFO

I'm not going to attempt to verify someone elses math, and will simply say that any statistics can be skewed to meet ones agenda. Regardless the fact remains that a significant portion of US households do not pay federal income tax and the federal deficit is growing.

I agree there is a multitude of other taxes at the federal level as well as state and locals levels. Many of these taxes are unavoidable. Including gas taxes and property taxes (directly or indirectly for renters). That just speaks to the entire tax burden being faced by the society. I did not mean to imply that 47% of households pay no taxes.

Your correct that the SS tax caps out and therefore those with lower incomes do pay more as a percentage. However SS benefits also cap out. I'd advocate removing both caps.

I do not believe in personal exemptions not any deductions. I'm not sure I understand your point on removing them being uncontituitonal. More likly incomes taxes as a whole are unconstituntion, but I'll leave that agrument for a later day.

Your point about unearned income being treated differently is a fair one. It shouldn't be.

Taking all this together quickly moves the direction of the tax system to a flat rate. For very dollar of income a person takes in (regardless of source) they would be required to pay x%. Imagine the efficiency gained in filing and administration of incomes taxes. The form could simply be 5 lines long.

Total income amount:
Multiply by x%:
Equals total amount owed:
Minus amount already paid:
Equals amount due or due back:

The percent should automatically be adjusted each year based on the budget and estimated total income. Any difference in estimates would of course be felt the following year as the overage or underage collected would be included in the budgeted amount.

Under this system society would be forced to pay as it goes. It would provide transparency to the actual costs and allocate them to each individual.

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Author: JAFO31 Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107271 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 6:56 PM
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KillroyFool: "I'm not going to attempt to verify someone elses math, and will simply say that any statistics can be skewed to meet ones agenda. Regardless the fact remains that a significant portion of US households do not pay federal income tax and the federal deficit is growing."

And those two facts may not necessarily be directly related (unless you assume that spending remains constant).

"Your correct that the SS tax caps out and therefore those with lower incomes do pay more as a percentage. However SS benefits also cap out. I'd advocate removing both caps."

Have you ever looked at the formula for calculating SS benefits. High earned income people already take in the shorts (and so do married couples, but I digress).

"I do not believe in personal exemptions not any deductions."

At least you are internally consistent in your beliefs.

"I'm not sure I understand your point on removing them being uncontituitonal. More likly incomes taxes as a whole are unconstituntion, but I'll leave that agrument for a later day."

I will try to post in more detail later.

"Taking all this together quickly moves the direction of the tax system to a flat rate. For very dollar of income a person takes in (regardless of source) they would be required to pay x%. Imagine the efficiency gained in filing and administration of incomes taxes. The form could simply be 5 lines long.

Total income amount:
Multiply by x%:
Equals total amount owed:
Minus amount already paid:
Equals amount due or due back:"


You have swallowed someone's koolaid. Much of the tax code defines income. Changing to a flat tax does not change the complexity WRT to the definition of income.

Your 5 line card may work for some who is a "wage slave" but not otherwise.

Regards, JAFO

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Author: loopholes One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107273 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 7:37 PM
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Your back hurts? My ears hurt. I am so tired of hearing about how much tax we pay and how everyone else is trying to get over.

Do you even realize how much you get for the piddly amount of tax this country collects from its citizens? And I mean you --- not just the purported welfare mamas and illegal aliens and loafers and scoundrels that are gaming the system by taking and not giving --- and I'm not talking about entitlement programs. You think it's cheap to protect the borders? To keep the national parks clean? To pay the military and ensure our defense? To keep the schools open? To maintain the highways? To move mail from sea to shining sea? To lay and collect tax? To run the federal courts, make sure our food is unadulterated, keep terrorists out, gather intelligence, maintain diplomatic relations with every other nation, etc?

Most every time I want to complain about my tax levels, I think about how great it is to be in the top half instead of the percentage who don't pay income tax. It stinks to be poor. All around us, people struggling to get by. Could you live on minimum wage? What if your rent was over $1000 a month? (That's cheap for where I live). What if you had to pay someone to watch your kids while you went to work? That costs...roughly minimum wage. And what if your employer didn't provide health insurance? Do you really think you'd be turning down work so you'd hit the "sweet spot" where you were making "just enough" to qualify for the EITC, but no more?

Why not count your blessings instead of the dollars you think you are handing out to your "undeserving" neighbor?

Money's fungible, and waste and fraud are inevitable, though not to be condoned or enabled. If it bothers you to think the tax dollars you paid were wasted on entitlement programs disguised as tax credits, then assume they were spent on a cause you believe in instead. Veterans' pensions. Prescription drugs for senior. Deporting illegal aliens. Putting tax cheats in jail and their children in foster care...no, wait, not the foster care part. Assume my tax dollars went to the waste & fraud.

Does your back feel better now?

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Author: ptheland Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107276 of 121571
Subject: Re: My back hurts- Rant Date: 10/2/2009 10:09 PM
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More likly incomes taxes as a whole are unconstituntion, but I'll leave that agrument for a later day.

You have just defined yourself as a member of a group with which is it usually impossible to reason.

I'll ask that you refrain from posting this stuff on the Tax Strategies board. We deal with the current reality of taxes, not the irrational thoughts of the fringes. Political Asylum (where you posted the identical thread) is the perfect place for this.

In the mean time, I will be ignoring this thread, and I invite others to do the same. And if you can't seem to ignore it, please post your comments on the thread in PA.

--Peter

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Author: KillroyFool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107470 of 121571
Subject: Re: My back hurts- Rant Date: 10/22/2009 6:54 PM
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Tax strategies should include influencing your legislators and taking part in the legislative process not sticking your head in the sand.

This recent article suggests one area congress may be violating the constitution in regards to income taxes.
http://townhall.com/columnists/WalterEWilliams/2009/10/21/am...

I don't debate that the congress has the ability to tax income. It was thier authoritiy before Amendment XVI but that amendment made it so the tax didn't have to be related to the state's size.

"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."

What I would argue is that the congress' current use of income tax collection to reditribute wealth and perform social engeneering is unconstituional.

The preable basically excludes any authority that is not specifically laid out in the rest of the constitution

"The Preamble does not grant any particular authority to the federal government and it does not prohibit any particular authority. It establishes the fact that the federal government has no authority outside of what follows the preamble, as amended."

The only place that hints of congresses ability to tax for such a purpose would be Article I section 8

"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States"

The general welfare clause has been used to mean almost anything. How is taking money from one individual family and redistributing it to another in the "general welfare" of the nation? How is it that all men are not created equal when it comes to the responsibility to support our nation financially?

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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107471 of 121571
Subject: Re: My back hurts- Rant Date: 10/22/2009 7:53 PM
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What I would argue is that the congress' current use of income tax collection to reditribute wealth and perform social engeneering is unconstituional.

Well, good for you. If you intend to challenge current tax law on constitutional grounds in court we'd love to hear how it turns out. When you report back, I'd personally appreciate it if you'd start a new thread since I'll be ignoring this one.

Phil
Rule Your Retirement Home Fool

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Author: bacon Three stars, 500 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 107472 of 121571
Subject: Re: My back hurts- Rant Date: 10/22/2009 9:39 PM
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The general welfare clause has been used to mean almost anything. How is taking money from one individual family and redistributing it to another in the "general welfare" of the nation? How is it that all men are not created equal when it comes to the responsibility to support our nation financially?

So I guess you also object to little old ladies in their dotage paying property taxes to support the school that educates their 20-something neighbors' kids?

You also haven't defined "equal" in the responsibility to "support our nation financially." Equal dollar amounts? Equal per centages of gross income? Equal per centages of AGI? What adjustments?

Clearly there are boundaries that should be drawn for all of those, but the areas wherein those boundaries should be drawn are deliberately vague and broad.

Eric Hines

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