#### Comment Preferences

• ##### i thought the idea being floated by Republicans(1+ / 0-)
Recommended by:
blue aardvark

was to cap the combined amount on several forms of deductions, which would have more effect on those with higher incomes.

"Okay, until next time. Keep sending me your questions, and I will make fun of you... I mean, answer them." - Strong Bad

• ##### Yes it does(33+ / 0-)

Taking away \$50,000 in deductions costs a person in the 38% tax bracket \$19,000.

For someone making \$500,000 that's equivalent to a \$1,900 hit for a median family making \$50,000. It hurts.

For someone making \$50,000,000 that's equivalent to a \$19 hit for someone making \$50,000. It's lunch money.

And that is what Krugman is talking about; limiting deductions throws the merely rich under the bus to protect the super rich.

Economics is a social *science*. Can we base future economic decisions on math?

[ Parent ]

• ##### is it a fixed amount that's being taken away,(4+ / 0-)

our a fixed amount that's being kept? My impression was, if the limit were say 50,000, that out would effect someone who normally deducts 100,000 more than someone who normally deducts 60,000. (I don't know what the actual amounts are.)

But in any case, none of this is going to effect the super rich as much as the merely rich.

"Okay, until next time. Keep sending me your questions, and I will make fun of you... I mean, answer them." - Strong Bad

[ Parent ]

• ##### Perhaps the super rich guy loses(2+ / 0-)
Recommended by:
AaronInSanDiego, sethtriggs

\$100,000 in deductions versus \$50,000. The point is that deductions as a share of income hit a maximum, usually, for the upper middle class and then fall off. For example, I believe there is a cap on the amount of mortgage interest that may be deducted.

Economics is a social *science*. Can we base future economic decisions on math?

[ Parent ]

Recommended by:
blue aardvark

and deductions.

"Okay, until next time. Keep sending me your questions, and I will make fun of you... I mean, answer them." - Strong Bad

[ Parent ]

• ##### Cap is \$1M.(7+ / 0-)

I'm going to strongly suggest that this stuff is really complicated, and that we shouldn't speculate on policy stuff we don't know.

• ##### well, if we knew,(4+ / 0-)
Recommended by:
blue aardvark, ferg, skohayes, m00finsan

it wouldn't be speculation :)

In any case, I thought it was the interest on \$1M, rather than \$1M of interest, but as I said, I'm not very knowledgeable about these issues.

"Okay, until next time. Keep sending me your questions, and I will make fun of you... I mean, answer them." - Strong Bad

[ Parent ]

• ##### Mortgage int exp is already limited(1+ / 0-)
Recommended by:
VClib

to the interest expense on \$1 mil of debt,  NOT \$1 mil of interest.

My Karma just ran over your Dogma

[ Parent ]

• ##### yes, that's what I meant. n/t(0+ / 0-)

"Okay, until next time. Keep sending me your questions, and I will make fun of you... I mean, answer them." - Strong Bad

[ Parent ]

• ##### I'm taking Krugman's word for it(10+ / 0-)

that limiting deductions, rather than raising rates, protects the super-rich at the expense of the rich.

I think he does understand a lot of this extremely complicated stuff better than I do.

Economics is a social *science*. Can we base future economic decisions on math?

[ Parent ]

• ##### The rich already have deductions limited(4+ / 0-)
Recommended by:
ferg, ozsea1, sethtriggs, cocinero

So limiting them a little more doesn't really bother them.

Higher rates, however, get applied to ALL their income, and would really pack a punch.

And raise a lot of revenue. But they don't care about that. All they care about is that they have only twice as much money as god, rather than three times as much.

• ##### The bigger share of total income that goes to the (3+ / 0-)
Recommended by:
Zinman, sethtriggs, cocinero

rich, the more important it is to raise their taxes.  It's where the money is.

“The future depends entirely on what each of us does every day.” Gloria Steinem

[ Parent ]

• ##### Other way around, I thought(5+ / 0-)

It was "capping deductions at \$50K" ...

• ##### Yeah, I think that's the proposal(0+ / 0-)

See discussion above; deductions as a percentage of income taper off as income increases because there are caps on some deductions and so on.

Economics is a social *science*. Can we base future economic decisions on math?

[ Parent ]

• ##### This is a great argument for the many(0+ / 0-)

flat taxers out there too.

After all is said and done, a lot more is said than done.

[ Parent ]

• ##### Those with the higest incomes have tax accountants(1+ / 0-)
Recommended by:
glorificus

to get around those limits one way or another. It will hit the middle class the most - enough income/deductions to hit limits, but not enough to get special tax law treatment to work around the basic law.

“The future depends entirely on what each of us does every day.” Gloria Steinem

[ Parent ]

• ##### Maybe they should cap the deduction for(0+ / 0-)

tax accountants. Limit it to the cost of TurboTax.

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