Comments on: Tax Proposals in Obama’s 2010 Budget Outline

By: TFB

TFB — Mon, 01 Feb 2010 22:37:11 +0000

Joe – Obviously this is not law yet, just a proposal, and we don’t have all the details. But if it works similarly to the lower capital gains tax rate (currently 0%) for people in the 15% or lower tax bracket, it will work like this:

If your taxable income without qualified dividend or capital gains is under $250k, any qualified dividend or capital gains between that number and $250k will be taxed at 15% and any extra qualified dividend or capital gains will be taxed at 20%. If your taxable income without qualified dividend or capital gains is already over $250k, every dollar of your qualified dividend or capital gains will be taxed at 20%.

By: Joe Lauricella

Joe Lauricella — Mon, 01 Feb 2010 19:48:11 +0000

Hello: Under the Obama Tax Proposal ,will all income below the $250 K for married couples be taxed at the lower rates or once you pass the $250K threshold will all your dividends and capital gains all be taxed at the higher rates because you passed the $250K mark. How do the marginal tax rates work here.

By: Martin

Martin — Tue, 26 Jan 2010 00:27:10 +0000

You are wrong that a “toolpusher” is a knowledge worker. The toolpusher is basically the foreman on a drill rig. At the moment, Chesapeake Energy is drilling a lot of gas wells and their toolpushers are earning a lot of overtime. If the price of natural gas moderates, toolpushers will be earning a whole lot less (or even be laid off).

You talk about the “average pay for the most common salaried job.” Chesapeake Energy has 7600 employees. NetApp has 8000 employees. SC Johnson has a lot more, but I’ll bet a lot are hourly, so the average pay of all employees is much less. These are not significant numbers of American workers. Most purchasing of cars, homes, etc. is not made by these workers because there are not enough of them.

Beyond that, I’m dubious that these tax increases are going to alter the behavior of what are (as Matt points out) high income individuals. These individuals get much bigger benefits, furthermore, from various tax deductions such as 401k or other retirement plans (an average wage earner can hardly max out their 401k, but someone at the 200k level can).

By: LIsa

LIsa — Fri, 15 Jan 2010 20:14:37 +0000

Reinstate the personal exemption phaseout and limitation on itemized deductions for those taxpayers earning over $250,000 (married) and $200,000 (single).

I find it pretty assuming on anyone’s part that considers a single person making $200,000 “rich”. Maybe that single person is divorced with children, paying child support and maybe that single person has elderly disabled parents that live with them and are responsible for their food, shelter and care, maybe that single person is supporting two households due to a partial custody agreement. And to not be able to claim deductions for that, is fucking UNFAIR. Progressive taxation is not fair.

By: D

Tue, 02 Jun 2009 16:26:06 +0000

If the married couple are both working than give them the double but when only one person in the household works why should they get another tax deduction. As is, the government is giving all these tax deductions to the married couple and only one spouse working when in reality they should be getting the same deduction as the single tax payer otherwise it’s showing that since I’m a single taxpayer and having to do the double job of working and doing the work at home makes me less of a person in the eyes of the government.

By: Catdog

Catdog — Fri, 06 Mar 2009 03:36:20 +0000

The people who are earning higher incomes are the same that purchase new cars, buy homes, spend money and stimulate the economy; which in turn creates jobs. If you penalize the folks who worked hard (maybe are paying off student loans) to be successful, then you are in fact strangling the American Dream. There are plenty of folks who may have bought an new home have kids in college and now may not be able to afford the home or college with the tremendous amount of taxes hitting them all at once. This could be devastating to those folks. This will certainly cause more foreclosures, depress the real-estate market further, cause further losses to the banks and the cycle continues. Our un-employment continues to reach record levels but hey I have an idea, lets tax the corporations more so they can lay-off more Americans so we can run the tax dollars through our bureaucratic government and end up paying those that lost their jobs about $.25 on the tax dollar collected…great idea! What needs to happen is to create jobs by lowering taxes, allowing those wealthy folks to spend which will create demand for products which will cause demand for employment which will allow folks to buy more homes. This is where this mess started and no one is addressing that problem. But they continue to increase the jobless population. BAD IDEA.

By: rob

rob — Mon, 02 Mar 2009 13:31:06 +0000

I suspect the problem is 125000 may not sound “rich” enough. Their focus groups probably said they would start to lose too much support at the level. Hence we have the marriage penalty.

By: indexfundfan

indexfundfan — Sun, 01 Mar 2009 23:16:09 +0000

TFB – thanks.

By: TFB

TFB — Sun, 01 Mar 2009 16:23:25 +0000

John – Usually adjusted gross income.

By: John

John — Sun, 01 Mar 2009 14:34:39 +0000

When they say “earning over $250k”, are they talking about gross income, or adjusted gross income?