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View Diary: The Devil Is in the Details -- State and Local Taxes (40 comments)

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  •  Linked study treats impact on federal taxes (3+ / 0-)
    Recommended by:
    Tim DeLaney, hmi, smileycreek

    incorrectly.

    First, the "Offset for Federal" should not be included here but in calculating Federal taxes.

    There is no reduction in taxes that state or local government receive through a "Federal Offset" State and local government receive the full abount on the line labeled "Total Taxes."

    The ability to deduct some state and local taxes on Federal Income tax returns, is properly accounted for in calculating their Federal Tax payments.

    The study's calculation for the Federal offset is done incorrectly as it does not include the phase out of deductions for higher incomes and the Alternative Minimum Tax which removes much of the tax deduction for property and income (or sales tax).

    The most important way to protect the environment is not to have more than one child.

    by nextstep on Sat Dec 03, 2011 at 12:57:40 PM PST

    •  Thanks for the input (1+ / 0-)
      Recommended by:
      smileycreek

      I must confess that I didn't fully understand all the consequences of the "federal offset". I don't know enough about all the details, but that said, I think the main thrust of the study is clear.

      Occupy is the symptom. Fundamental reform is the cure.

      by Tim DeLaney on Sat Dec 03, 2011 at 01:09:25 PM PST

      [ Parent ]

      •  Another problem with the study is the definition (6+ / 0-)

        of income for the lowest incomes.

        This study does not include income from government assistance such as housing assistance, food stamps, Medicaid, etc..  While none of this income is taxed it significantly increases income -- which is the very reason these programs exist.  For the lowest income group, government assistance is a large share of income if not the majority of income.  This results in the study grossly overstating the share of income paid in tax by the lowest income group.

        So the study significantly overstates the low income percent tax burden and understates the high income tax burden.

        The most important way to protect the environment is not to have more than one child.

        by nextstep on Sat Dec 03, 2011 at 01:35:28 PM PST

        [ Parent ]

        •  For all its flaws, (2+ / 0-)
          Recommended by:
          smileycreek, nextstep

          I think the study brings out a major defect in our total tax structure.

          If you ignore completely the bottom quintile on the grounds that they receive significant government assistance, the remaining four quintiles paint a consistent picture of regressive taxation.

          Occupy is the symptom. Fundamental reform is the cure.

          by Tim DeLaney on Sat Dec 03, 2011 at 03:00:44 PM PST

          [ Parent ]

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