In Obama we have a Presidential candidate with rhetorical skills not heard from a U.S. President in over 40 years; the ability to inspire Americans to achieve their hopes and dreams, and a candidate who has definitive income tax proposals for America's senior citizens that will significantly impact many baby boomers.
Before outlining Obama's income tax policy for senior citizens, allow me to ask a couple of questions that I believe will highlight the significance of Obama's tax policy for senior citizens.
In your humble opinion (assuming taxpayer does not itemize his/her deductions), how much federal income tax should a single tax filer, senior citizen, with an annual gross income (including social security) of $50,000, pay?
- Should Pay NO Federal Income Tax;
- Should Pay Federal Income Taxes of less than $1,000;
- Should Pay Federal Income Taxes of $1,001 to $2,000;
- Should Pay Federal Income Taxes of $2,001 to $3,000;
- Should Pay Federal Income Taxes of $3,001 to $4,000;
- Should Pay Federal Income Taxes of $4,001 to $5,000;
- Should Pay Federal Income Taxes of $5,001 to $6,000.
Do not forget your answer to the foregoing question, now answer this question:
For 2007, how much federal income tax did a single tax filer, senior citizen, with a gross income of $50,000, e.g., social security income of $15k and pension/IRA/401k income of $35k) actually owe/pay in 2007? (for this calculation assume taxpayer took the standard deduction, i.e., did not itemize his/her tax deductions)
- Actually Paid Federal Income Taxes of less than $1,000;
- Actually Paid Federal Income Taxes of $1,001 to $2,000;
- Actually Paid Federal Income Taxes of $2,001 t0 $3,000;
- Actually Paid Federal Income Taxes of $3,001 to $4,000;
- Actually Paid Federal Income Taxes of $4,001 to $5,000; or
- Actually Paid Federal Income Taxes of $5,001 to $6,000.
Remember your answers!
Following is Obama’s income tax proposal concerning senior citizens, to wit:
Eliminate Income Taxes for Seniors Making Less Than $50,000.
Obama will eliminate all income taxation of seniors making less than $50,000 per year. This will provide an immediate tax cut averaging $1,400 to 7 million seniors and relieve millions from the burden of filing tax returns.
Now, the answer to the question, how much Federal Income Taxes did a single tax filer, senior citizen, with an income of $50,000, (including social security) actually owe/pay in 2007:
The Answer: For 2007, a single tax filer, senior citizen, with social security income of $15k and pension/IRA/401k income of $35k, paid/owed actual federal income taxes of $5,593.
Obama's tax policy for senior citizens will have a measurable impact of $466 per month for those fortunate to have annual incomes of $50,000.
Final Note: Presently, as the taxability of social security is dependent on its relative relationship to one's other income, it should be noted that with reference to the above example, if the social security income was less, and the other income greater, the actual 2007 taxes paid would have been greater than $5,593.