2017 "Tax Reform": They'll Screw This Up Too, Right? - Page 59 - Politics and Economics

A slight issue with this bill is its effects are wildly variable depending on whoever's specific circumstances, so you'll find people whose tax burden drops substantially and others whose bill jumps up a lot based even if they're kind of the same from a distance.

Absolutely correct.

Basically low income families and middle class families with no dependent kids and/or who can't or don't shelter a lot of money pretax get ****ed.

Middle class with lots of dependent kids and/or a lot of pretax savings and of course the super rich people make out.

I'll save about $5000 on 2018 Federal taxes even living in a high property tax state and working in a high income tax state and losing those deductions. My effective federal tax rate (not including FICA) will be about 6.4%. It's really not fair at all to low income folks, but if I don't shelter that money pre-tax it's going to the Koch brothers, Blackwater, and Ratheon -- not poor people.

12-03-2017 , 11:59 AM

#1452

dth123451

Carpal \'Tunnel

Join Date: Jul 2012 Posts: 15,502

Another sneaky way privileged people benefit in America is the ability to take advantage of our stupid-ass tax code. If you max out 401k, HSA and ROTH contributions, you can stash away about $30k a year tax free (double for married couples). This is doable if you have parents who pay the rent during your 20s, or a trust fund, or really any substantial liquid assets. Oh and it helps if you aren't paying off (now not deductible) student loans.

12-03-2017 , 12:04 PM

#1453

Jbrochu

banned

Join Date: Jan 2005 Posts: 16,054

It's doable with a middle class income (real middle class income, not lol average HH income) and some reasonable amount of fiscal responsibility.

12-03-2017 , 12:16 PM

#1454

TheHip41

Carpal \'Tunnel

Join Date: Jul 2004 Posts: 27,047

Quote:

Originally Posted by awval999

So the Senate bill is like Christmas morning for middle and upper-middle class families with children due to the Child Tax Credit.

A family of 5 making $100,000 nearly has zero tax liability (Senate bill)

$100,000 gross
-$24,000 standard deduction
-$18,000 401k
=$58,000 taxable

=$1905+$4674 = $6579 - 3 x $2000 CTC = Total tax = $579

Senate Tax Brackets
0-1905010%$1905 (if max out this rate)
19050-7740012%$7002(+$1905) (if max out this rate)
77400-9114522.5%$3092(+$7002+$1905) (if max out this rate)

You can play with the numbers. But drastically increasing the phaseout threshold of the CTC from ~$100,000 to ~$500,000 and DOUBLING the CTC from $1000 to $2000 is large tax savings for families in the $100,000-$150,000 income range.

Current Law

I’m sure you ****ed these calcs up too

Also. I’m sure a family with 3 kids is putting 18,000 of their 75,000 a year into 401k.

Go **** yourself.

12-03-2017 , 12:17 PM

#1455

TheHip41

Carpal \'Tunnel

Join Date: Jul 2004 Posts: 27,047

You are the poker player that puts their opponent on a range of exactly 22 and says “my equity is 87%!!!!”

You have literally no idea what you are talking about.

Also. What about a family with 1 kid. Or a single mom with 2 kids

Just lather yourself up with the trump love.

12-03-2017 , 12:24 PM

#1456

Jbrochu

banned

Join Date: Jan 2005 Posts: 16,054

Quote:

Originally Posted by TheHip41

I’m sure you ****ed these calcs up too

Also. I’m sure a family with 3 kids is putting 18,000 of their 75,000 a year into 401k.

Go **** yourself.

To take your points one at a time:

His calculations are correct if assuming the Senate bill passes unchanged.

How much a family with 3 kids in this specific situation can put away depends greatly on where and how they choose to live, but maxing one 401(k) isn't an unreasonable assumption for much of the country outside HCOL areas IMO. [Not that people do, but they could.]

I'm fine if he goes and ****s himself.

12-03-2017 , 12:34 PM

#1457

Huehuecoyotl

Carpal \'Tunnel

Join Date: Sep 2009 Posts: 29,257

Quote:

Originally Posted by Jbrochu

To take your points one at a time:

His calculations are correct if assuming the Senate bill passes unchanged.

How much a family with 3 kids in this specific situation can put away depends greatly on where and how they choose to live, but maxing one 401(k) isn't an unreasonable assumption for much of the country outside HCOL areas IMO. [Not that people do, but they could.]

I'm fine if he goes and ****s himself.

Quote:

But the reality is this: Two-thirds of Americans aren't even saving money in a 401(k), let alone maxing out their contributions each year.

In fact, according to data from Vanguard, just 4% of people earning below $50,000 a year max out their 401(k) at the current limits, and 11% of people who make between $50,000 and $100,000 do. People making over $100,000 are the most likely to max out their 401(k), perhaps unsurprisingly, with 32% making the highest allowable contribution.

http://www.businessinsider.com/ameri...avings-2017-10

12-03-2017 , 12:37 PM

#1458

stinkubus

Pooh-Bah

Join Date: Jan 2012 Posts: 4,422

Quote:

Originally Posted by Nonfiction

Conservatives don't actually care about spending though in general, just on spending that goes to lazy mooching minorities.

Most of these types of people are convinced that welfare spending is some huge % of the federal budget when it's really just a rounding error.

12-03-2017 , 12:47 PM

#1459

stinkubus

Pooh-Bah

Join Date: Jan 2012 Posts: 4,422

Quote:

Originally Posted by wheatrich

The amendments are ridic too, one taxes gift cards if you got it as employee of the month award.

You'll just have to pull up those bootstraps and accept this hearty pat on the back instead like we used to.

I thought those were always taxable? My last employer had contests and the prizes were often gift cards. The value of the prize always appeared on your next pay stub.

12-03-2017 , 12:55 PM

#1460

Jbrochu

banned

Join Date: Jan 2005 Posts: 16,054

Hue I know people don't utilize their 401(k), but that doesn't mean they couldn't.

For one thing, these people don't really need to be driving new $50k pickup trucks as the second family vehicle. I swear it seems like 50% of the country outside urban areas have a new $50k pickup truck.

But anyway my point from my earlier post was that low income families (who can't save) and middle income families (who choose not to save) are gonna get unfairly ****ed.

A family making $100k outside of an urban HCOL area generally should be able to max out at least one 401k, even if the vast majority don't.

Edit: I see now that I used the phrase "not an unfair assumption" which leads to believe I think people are actually doing this and not that they could be doing this. My bad.

Last edited by Jbrochu; 12-03-2017 at 01:12 PM.

12-03-2017 , 01:14 PM

#1461

Huehuecoyotl

Carpal \'Tunnel

Join Date: Sep 2009 Posts: 29,257

Not a problem. I just wanted to provide some additional info on how many people are actually doing it.

12-03-2017 , 01:18 PM

#1462

Huehuecoyotl

Carpal \'Tunnel

Join Date: Sep 2009 Posts: 29,257

Quote:

Long-term policy consequences aside, the GOP had a lot to gain, politically, by passing this bill. The economy has been*gaining steam over the past year, and while this tax bill*probably won’t produce the growth*that its proponents claim it will, it*probably won’t reverse the trend either, at least not in the short term.

If GDP growth is still humming along in two years, Republicans will credit this legislation. And if history is any guide, Trump will be well-positioned for reelection– despite all the reasons why Democrats may find that prospect mind-blowing.

Yes, growth will have preceded the cuts. Yes, the causal relationship between cuts and growth is tenuous anyway. And yes, the cuts will swell the deficit and expand inequality. But as we all surely know by now, such facts don’t really matter all that much anymore, and maybe they never did. After all, Republicans have never wavered from their insistence that the Reagan tax cuts of 1981 ushered in strong growth later that decade. Such faith contributed to big GOP victories in 1984 and 1988, and continues to inform Reagan nostalgia on the Right.

And if Trump wins reelection, everything else that we associate with his candidacy and his presidency may be validated and copied by future politicians, on both sides, as “the way to win” – leaving a political legacy that may far outlast the consequences of this tax bill.

https://theconversation.com/the-gop-...eres-why-88467

12-03-2017 , 02:27 PM

#1463

microbet

Solar Powered

Join Date: Jan 2005 Posts: 56,670

Quote:

Originally Posted by awval999

So the Senate bill is like Christmas morning for middle and upper-middle class families with children due to the Child Tax Credit.

A family of 5 making $100,000 nearly has zero tax liability (Senate bill)

$100,000 gross
-$24,000 standard deduction
-$18,000 401k
=$58,000 taxable

=$1905+$4674 = $6579 - 3 x $2000 CTC = Total tax = $579

Senate Tax Brackets
0-19050 10% $1905 (if max out this rate)
19050-77400 12% $7002(+$1905) (if max out this rate)
77400-91145 22.5% $3092(+$7002+$1905) (if max out this rate)

You can play with the numbers. But drastically increasing the phaseout threshold of the CTC from ~$100,000 to ~$500,000 and DOUBLING the CTC from $1000 to $2000 is large tax savings for families in the $100,000-$150,000 income range.

Current Law

If every Americans taxes were dropped to zero that would be an awesome Christmas for everyone, right?

The Democrats need to talk more about services and less about taxes. In a vacuum, lower taxes always wins the tax debate. Someone should probably mention the trillion a year on the war budget, but I wouldn't hold my breath waiting for democrats to do it.

12-03-2017 , 03:54 PM

#1464

goofyballer

Carpal \'Tunnel

Join Date: Jun 2005 Posts: 70,719

Quote:

Originally Posted by TheHip41

Also. I’m sure a family with 3 kids is putting 18,000 of their 75,000 a year into 401k.

That post is peak awfal

12-03-2017 , 04:06 PM

#1465

FlyWf

It's the other way

Join Date: Apr 2004 Posts: 58,097

awval hasn't posted in Politics for weeks but he runs in here to shill for Daddy's Big Tax Cut for the wealthy.

12-03-2017 , 05:51 PM

#1466

ScreaminAsian

For President

Join Date: Oct 2008 Posts: 33,333

12-03-2017 , 05:53 PM

#1467

AllTheCheese

Carpal \'Tunnel

Join Date: Nov 2007 Posts: 11,898

But he said "darn" so it's okay.

Last edited by AllTheCheese; 12-03-2017 at 06:10 PM.

12-03-2017 , 05:56 PM

#1468

microbet

Solar Powered

Join Date: Jan 2005 Posts: 56,670

Quote:

Originally Posted by microbet

Shout out to John Lewis though for supporting peace and religious liberty.

Quote:

On April 5, 2017, U.S. Representative John Lewis (D-GA) re-introduced the Religious Freedom Peace Tax Fund Bill. The Bill’s number in the 115th Congress is H.R. 1947.

This bill directs the Department of the Treasury to establish in the Religious Freedom Peace Tax Fund for the deposit of income, gift, and estate taxes paid by or on behalf of taxpayers: (1) who are designated conscientious objectors opposed to participation in war in any form based upon their sincerely held moral, ethical, or religious beliefs or training (within the meaning of the Military Selective Service Act); and (2) who have certified their beliefs in writing.

Amounts deposited in the Fund shall be allocated annually to any appropriation not for a military purpose. Treasury shall report to the House and Senate Appropriations Committees on the total amount transferred into the Fund during the preceding fiscal year and the purposes for which such amount was allocated. The privacy of individuals using the Fund shall be protected.

http://peacetaxfund.org/about-the-bill/

12-03-2017 , 06:17 PM

#1469

eyebooger

Join Date: May 2010 Posts: 58,706

Quote:

Originally Posted by ScreaminAsian

I'm way out of my depth with regard to economics compared to most of you, but wouldn't people who are "just spending every darn penny they have" be good for an economy?

12-03-2017 , 06:24 PM

#1470

Jbrochu

banned

Join Date: Jan 2005 Posts: 16,054

I used to spend most of my money on booze, women, and movies. The rest I just wasted.

Spoiler:

12-03-2017 , 06:26 PM

#1471

hacksaw JD

journeyman

Join Date: Jan 2017 Posts: 209

Quote:

Originally Posted by stinkubus

I thought those were always taxable? My last employer had contests and the prizes were often gift cards. The value of the prize always appeared on your next pay stub.

they are and should be. whether a copmany adds it to an employee's paystub will vary by company, but they are taxable.