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As I sit and ponder the two tax returns that Mitt Romney did release, I wonder if the top marginal tax rate has any relevance.  It seems clear to me that any person of wealth (meaning anyone who can afford to hire tax attorneys and accountants) will not pay "income taxes" at anything near the proscribed rate.  After they end up shuffling their "income" off into various sheltered categories, whatever is left is subject to treatments that the ordinary citizen cannot even comprehend.

If we focus our attention on the "rate" which the wealthy pay at the highest level, we are playing into their hands... they are going to "compromise" and agree to a higher rate, which of course they will never pay.  Without systemic reform, meaning, in essence, abandoning the whole current tax structure, the wealthy will never pay anything close to what I think the non-wealthy would consider to be their "fair share."

If we expend all our energy on sticking it to the wealthy by refusing to renew their Bush tax rates, while we may win the battle, I fear we may lose the war!

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Comment Preferences

  •  Thanks for your concern (12+ / 0-)

    Patriot: the person who can holler the loudest without knowing what he is hollering about. Mark Twain

    by Deathtongue on Sat Nov 10, 2012 at 09:50:21 PM PST

    •  The diarist doesn't admit or show any awareness (3+ / 0-)
      Recommended by:
      elkhunter, Cinnamon, Calamity Jean

      that you have to try, in every possible way, to get the wealthy to pay their fair share.

      To throw hands up in the air and give up on trying, right after winning a mandate in this election makes absolutely no sense at all.

      The only thing that would wreck the Dems now would be to FAIL to let the tax cut for wealthy expire.

      Not only that, but the wealthy are already being told that they can keep the tax cut on the first 250,000 of their income - - which is already an unfortunate concession.

      Through Eisenhower, the wealthiest Americans were required to pay 90% of their income in taxes, and the nation thrived.  We're nowhere near 90% now - and the diarist wants to make them pay less than 30%.

      The biggest problem is that capital gains tax is set at 15% for all income levels, and so the wealthy can set things up so that they only have to pay 15%, since capital gains represent most of their newly rearranged income.

      •  the diarist is trying to figure out... (0+ / 0-)

        ...how to make sure that the wealthy do not weasel out of their real obligation.

        I am not in any way suggesting that we give up on trying, just suggesting that simply eliminating the Bush tax cuts for the wealthy will not accomplish very much.  ( I am getting some interesting lessons here.)

        I would like to think that we could go back to an Eisenhower era rate of 90%... and I agree that the capital gains rate is a total rip off.  Someone has to explain to me again why it is that, when you just sit on your ass and watch your money come in the door you deserve a lower tax rate than people who actually have to get up in the morning and go to work.

  •  What if-- (0+ / 0-)

    We got the tax breaks and Bush had to make up the difference?  If he's okay with that, so am I.

    "Injustice wears ever the same harsh face wherever it shows itself." - Ralph Ellison

    by KateCrashes on Sat Nov 10, 2012 at 09:50:39 PM PST

  •  Mitt Romney paid a low rate (9+ / 0-)

    because almost all his income is capital gains. Most wealthy people do pay quite a lot in taxes and increasing the rate would collect quite a bit of revenue. The capital gains rate is scheduled to increase from 15% to 23.8% on Jan 1, 2013, as a result of a combination of the expiration of the Bush tax cuts and the implementation of the Obamacare Medicare tax on investment income. This by itself will increase Romney's taxes by millions of dollars.

    "Abandoning the whole current tax structure," as you say, would be incredibly ill advised. Much of its complexity comes about from efforts (many of them successful) to close loopholes.

    •  Let the Bush tax cuts, all of them, expire. (3+ / 0-)
      Recommended by:
      notrouble, bluezen, Hockeyray
      •  It would be a good idea during boom times (4+ / 0-)

        but the concern is that shutting off the fiscal spigot suddenly while the economy is weak (whether through spending cuts or tax increases) is effectively a reverse stimulus and would cause a recession.

        •  It would piss off the middle class royally. (4+ / 0-)

          so it would backfire.

          The Senate passed a bill to extend middle class tax cuts, and that Senate vote is a fait accompli, a done deal.

          Now it is up to the House - it is in their hands - either they send a bill to the Senate that can go into reconciliation, or all tax cuts will expire - and it will be squarely the Republican House's fault.

          If and when they do expire, the pressure on Boehner will be absolutely overwhelming.

          •  I completely agree (4+ / 0-)

            and I think President Obama is right that we should immediately extend the tax cuts for income up to $250,000. I see the political path to that you laid out and I suspect the House republicans are starting to see it too... and they don't like it...

            •  What they don't like most is that (1+ / 0-)
              Recommended by:
              bluezen

              after years of playing Senate politics the way that "nice guy" Tom Daschle played them (and was steamrolled consistently), the Dems in the Senate are using a strategy now that is based on what they did before Tom Daschle became their leader, back in the days of George Mitchell.

              Living through the George Mitchell years as Senate Democratic Leader, the strategy being used now in the so called "fiscal cliff" was the normal Democratic leadership strategy.  It was used repeatedly in the 1980s to thwart Reagan and Bush's excesses, and it was frequently successful.

              Joe Biden lived in and worked in the Senate during that period, and he knows the strategy well, as he was part of the inner group involved in strategizing.  It has taken four years for the President to realize that Tom Daschle was not the gifted Senate leader that George Mitchell was.   President Obama now realizes that Joe Biden is the one who remembers using the type of strategy that we're seeing now.  Biden can do this; Obama has no experience doing this, and was not the power-player that Biden was (for decades).

              This is what the House Republicans really don't like.  What they don't like, and what they should fear, is that they are now playing a kind of game that most of them do not know how to play, since they were not in the House when George Mitchell was Democratic Leader.

              So if this seems like something new, rest assured in knowing that the older Democrats in the Senate know exactly how to do this, successfully.  The only thing stopping them from using this strategy earlier was that Obama wanted to play the game the way Tom Daschle was encouraging him to play it - - i.e., under Daschle, the Dems were the perpetual beach wimps who had sand kicked in their faces and never worked up the nerve to do anything about it.

              There was a reason why Joe Biden was needed on the Democratic ticket, and we are only now about to find out what that reason really was.

          •  You said it (1+ / 0-)
            Recommended by:
            Calamity Jean

            It's on the Republican house.... that's where the
            Pressure needs to be, "Why does the house not want to pass a tax cut on 98% of the country Mr. Speaker?"

        •  The economy of finance is booming. (1+ / 0-)
          Recommended by:
          bluezen

          And we're much better off with a new appropriate set of stimulus for the current times for the middle class. This decade old round of tax cuts were the stupidest thing ever.

        •  Increasing taxes wouldn't be (0+ / 0-)

          shutting off the fiscal spigot because that money could actually be used to help boost the economy.  Raising taxes would only be a net economic negative if the resulting revenue went into the black hole of "deficit reduction".

    •  Complexity comes from efforts to close loopholes.. (1+ / 0-)
      Recommended by:
      Argyrios

      ... I am apparently incredibly naive. (seriously)  If you have a "loophole", why can't you simply close it?  Why does it have to add additional complexity to an already unfathomable (for the ordinary taxpayer) tax code.  Can you give an example... I am sure it will be entertaining.

      •  No, I am happy to give many examples... (5+ / 0-)

        I'll drone on and on for as long as you like. Let me give one example of a proposed change and two examples in the current tax code.

        The proposed change is closing the carried interest loophole. President Obama and the Democrats are proposing a change that actually adds dozens of pages to the tax code (and would probably need hundreds of pages in regulations) in order to prevent fund managers from earning their performance bonuses in the form of carried interest partnership allocations and getting capital gain treatment on what should be ordinary compensation income. Closing the carried interest loophole adds complexity to the code -- defining what an investment partnership is, what a manager is, and what sorts of partnership income allocations aren't respected as such.

        A good example in the current code is subpart F.

        In a simple world, a foreign corporation is outside the U.S. tax net -- we simply don't have jurisdiction over it. In a simple world, that entity could then be controlled by U.S. persons and enter into all their contracts for them and all that money could very easily escape tax.

        We have an extreme complex system contained at sections 951 through 959 of the tax code, subpart F, which provides that if a foreign corporation is controlled by U.S. persons, those U.S. persons have to directly include in their income the "subpart F income" earned by the foreign corporation (even though it is not distributed or paid out as dividends at all). That's the simplest way I can say it, but you can see how this regime can get very complicated very quickly -- defining what it means to be "controlled" for example, and dealing with situations where the corporation is acquired at a time when it has retained earnings.

        Another example in the current code is the "original issue discount" regime.

        Original issue discount is basically interest that is hidden inside the stated principal of a debt instrument. If I give you a bond in the principal amount of $100 but you only pay $50 for it, for example, that extra $50 is basically interest, not principal, and so should be taxed as it accrues like any other interest -- i.e., even if the term of the note is 10 years, you have to pick up the accruing hidden interest each year. These rules can be incredibly complex. To be clear, if there were no OID rules and we had a much simpler world, you'd still be taxed on that income when the note is paid off; the complexity comes from eliminating the timing advantage of deferring the income by hiding it inside the principal.

        I am happy to answer questions, go into far greater detail, and give additional examples but I suspect maybe you'd get bored. Do let me know, though.

        •  thanks. (seriously).. (1+ / 0-)
          Recommended by:
          Argyrios

          lets start with the "carried interest" loophole... why is it not possible to just eliminate it?  What in the code provides this loophole?... Why can't it simply be done away with?... If what you say is "for real", then I am a bit dismayed.  Can you explain all this in a way which is comprehensible to someone who is not a lawyer or an accountant.

          Why can't we simply say... its all the same... income is income?  

          I do appreciate your explanations.

          •  Some tax folks actually (1+ / 0-)
            Recommended by:
            Kathy S

            sneer at the notion that carried interest is a "loophole" at all because it really is a consequence of the normal and longstanding rules for taxing partnerships.

            Partnerships are quite flexible business arrangements. I say that not as a matter of law but as a matter of reality. People can enter into whatever business relationships they want; they can agree to divide the money from a business venture however they want. The law doesn't (and shouldn't) tell partners what sorts of private business deals about how to divide money are "allowed" or not; rather the tax code should respond appropriately to whatever their business venture happens to be.

            In a normal operating business, it is quite common for one partner to put up the capital or the assets and another partner to contribute skills. Say one person (the rich guy) has a boat and another person (the skills guy) has nautical experience; they can form a partnership where they combine those resources to operate, say, a ferryboat, and divide the income from the business how they want. The person who contributes the boat might not really ever do anything; the captain does all the work. Even though the captain didn't put anything of value in except his skills, he gets his share of the profits of the business as a partner. No problem in this situation... it's what you would expect. And because it's the operating income of a business, it's ordinary income.

            But what if instead of putting in a boat, the rich guy puts in his money, and instead of putting in nautical skills, the skills guy puts in his money management experience. It's the same basic situation, but now the income of the business is largely long term capital gains: The rich guy's money is invested to buy, hold, and sell companies. As before, the partnership splits the income of the business, but now it's capital gains income and the one who is working to manage someone else's money -- who comes into an office building and sits in a chair at a desk every day and works like any other white collar worker -- is getting a split of capital gains income. Because his job happens to be money management, and because that is a job that happens to involve generating capital gains for people, he can be set up as a partner in an investing business and convert his labor into capital gains income rather than into ordinary income.

            So this isn't a loophole you can just close, but a consequence of the interaction of the partnership tax rules with the capital gains rate preference. If you accept that there's a capital gains rate preference, then you have to add complexity to the tax code to eliminate the preference in this specific context of money managers in investing partnerships (the rich guy ought to get capital gains income; the "carried interest loophole" is that the money manager who is working instead of investing is also getting capital gains income even though it's income from working and not income from investing his own money).

            You asked why we can't say it's all the same -- "income is income" -- which might be getting at the question of why there's a capital gains rate preference at all. This of course is a much broader topic. Suffice to say for now that there are some fairly compelling policy reasons for treating capital gains differently than ordinary income, reasons which have nothing to do with trying to open up a loophole for money managers. But it's very late in my time zone and I'll come back tomorrow to see if you're interested in my thoughts on that.

            •  Preferential rate for capital gains (1+ / 0-)
              Recommended by:
              Argyrios

              "Suffice to say for now that there are some fairly compelling policy reasons for treating capital gains differently than ordinary income..."

              Not where I come from. Also, not where the Simpson-Bowles commission and the Rivlin-Domenici deficit reduction report came from. Both recommended equal rates on all income, i.e., on wages, dividends and capital gains. Both also coupled this equal-taxes position with lower marginal rates. Equal taxes on all incomes was one of the centerpieces of Ronald Reagan's 1986 Tax Reform Act. That act (and Simpson-Bowles, and Rivlin-Domenici) implicitly rejects those "fairly compelling policy reasons for treating capital gains differently than ordinary income."

              •  I agree with your analysis (0+ / 0-)

                and I was trying to be precise. You need to treat capital transactions differently, but that doesn't necessarily mean giving capital gains a preferential rate. It was late at night and I didn't want to get into all that. For example, in 1986 the rates for capital and ordinary were the same, but the fundamental distinction between capital and ordinary still existed and capital gains were still "better" because of the capital loss limit.

                Also, you've hit the nail on the head that if you have a low marginal rate for ordinary income, you can have equally low marginal rates for capital gains (like in 1986). I didn't think the person I was responding to would be in favor of low marginal rates on ordinary income, so I think the implication is a preferential rate on capital gains. I am also pretty skeptical of having a low marginal rate on ordinary income but open to persuasion.

                Admittedly I am not familiar with Rivlin-Domenici.

                •  Capital gains taxes (1+ / 0-)
                  Recommended by:
                  Argyrios

                  Happy to hear we're pretty much on the same page. Personally, as an incentive to investment, I'd favor zero capital gains taxes on initial public offerings (IPOs); the money raised in those offerings goes to companies and grows jobs. Subsequent trades don't grow jobs, they just grow portfolios; stock is simply changing hands, nothing more, nothing less. P.S. The top marginal rate following the 1986 Tax Reform Act was 28%, which applied equally to all income, i.e., wages, capital gains and dividends. I don't know if I'd call that low (though of course it is lower than the current 35%, and even lower than the 39.6% top rate under Clinton, which could be coming back, depending.)

            •  Thanks for the explanation... (0+ / 0-)

              ... please continue.  I am very much interested in your thoughts on the capital gains preference. Does one really need a degree in economics to appreciate the nuances in our tax code?  

              •  Well not a degree in economics (1+ / 0-)
                Recommended by:
                Kathy S

                but you need to study accounting or law, yes. What's really interesting to me about it is how you can start from first principles, like "how do you measure income," and just snowball very quickly into really complex topics without making any further policy choices other than "let's measure income accurately." In my view, a simple tax code is a manipulable code. Human beings aren't simple, and human actions and lives and economic choices and financial arrangements are not simple, and the tax code has to reflect the variety that exists in the world with sufficient precision to give the right answer most of the time.

                Capital gains is a very broad topic, but let's start with the basic reason you have to treat it differently (even if the rates were the same). Ordinary income is what results from working, or putting your property to work -- salary, rent, royalties, sales of inventory, etc. Capital gains and losses, on the other hand, are attributable to market forces, fluctuation in the value of your property. We don't tax those fluctuations except upon a "realization event," for example, a sale or liquidation of an asset. This is necessary because a lot of property is not liquid; you can't write a check to the government and write "35% of the appreciation in value of my property" on the check; you have to pay in dollars. Plus, even more importantly, appraisal of non-liquid assets is very expensive and it's much easier to value something at the time it is sold (because it's worth what someone pays for it). So a realization event is necessary to tax fluctuation in property valuation.

                This makes the realization of gains and losses somewhat elective. We have to net capital gains and losses separately from ordinary income, or else people can electively realize only their losses and severely erode the tax base. This is called the capital loss limit -- you cannot offset unlimited capital losses against ordinary income (the capital loss limit is currently $3000 per year for individuals and as a matter of pure theory it really should be zero). People with hedged or diverse portfolios just have a ton of losses sitting around even if their overall mix of investment is wise; they could theoretically earn very large amounts of ordinary income and never pay a dime of taxes if we didn't have a capital loss limit. So it is absolutely necessary to treat ordinary and capital as different categories (even if you tax them at the same rate).

                But, since we already have to provide a different accounting for capital transactions, there is the opportunity to impose different rates so as to minimize how taxation affects economic choices. In the case of salary, rents, and royalties, I think marginal rates have to creep very high before you start distorting economic choice. For example, my land will generate rent of whatever the market will bear, and the more rent the better, and I don't really have a choice other than to try to maximize what I can get out of it. It's a no-brainer and there isn't really a trade-off to using my property as efficiently as I can, no matter what the marginal rate is. This is part of the reason I am in favor of high marginal rates.

                But in the case of capital gains, you quickly start creating very powerful incentives not to realize gain on appreciated assets when the capital gains rate gets too high. This is called the "lock in effect." People have a choice where to put their money, but whenever you sell an appreciated asset, you take a haircut in the overall value of your property. It is rational to say, "this emerging industry is a better investment opportunity, but to cash out of my current investments I immediately pay X dollars I don't really have to pay if I don't make the choice to re-allocate, so therefore I won't re-allocate, even though my money is better put to use in the new opportunity, unless the benefit is expected to be greater than X dollars." This means there is an economic friction applied by the capital gains tax which has the effect of slowing the rate at which capital is reallocated in response to new information.

                Now I am very sensitive to the fact that rich people get a lot of capital gains income and that income inequality is a big problem. That is why I am in favor of extremely high rates on the least distortive tax of all: inheritance taxes. I say, let people accumulate capital at low tax rates throughout their lives, but take most of it when they die. That's a policy trade I'd make in a second.

      •  Senate could pass a progressive capital gains tax (0+ / 0-)

        indexed to total wealth, domestic and foreign.

        Someone like Romney would have to pay the very highest capital gains tax rate because his combined foreign and domestic wealth would put him in the top bracket.

        Capital gains tax used to be 25% - and wealthy Americans should have to go back to paying 25% once again.

        They can keep the capital gains tax at 15% for middle income Americans.

        Loopholes could be eliminated, by making the calculation of tax bracket take total wealth into account (i.e., net worth, as calculated using Suze Orman's basic model of total current assets minus liabilities).

        •  Capital gains tax rate is a marginal rate. (0+ / 0-)

          currently, those in the 10% and 15% tax bracket pay no tax on LT capital gains, and those in the 25% bracket and up pay 15%.

          As I recall before the Bush tax cuts there were also rates in between the highest and lowest rates.

          You can't scare me, I'm sticking to the Union - Woody Guthrie

          by sewaneepat on Sun Nov 11, 2012 at 04:08:39 AM PST

          [ Parent ]

          •  No tax on capital gains (0+ / 0-)

            "...those in the 10% and 15% tax bracket pay no tax on LT capital gains..."

            This was indeed true, but it was a temporary provision that expired in 2011; it's not on the books for 2012.

            •  I am pretty sure you are wrong. (0+ / 0-)

              I have looked several places and they say what I said. Can you provide a link for your assertion? It is still a marginal rate if the Bush tax cuts expire in 2013.

              You can't scare me, I'm sticking to the Union - Woody Guthrie

              by sewaneepat on Sun Nov 11, 2012 at 04:23:27 PM PST

              [ Parent ]

              •  II: No tax on capital gains (0+ / 0-)

                My son was lucky enough to be in that position when he filed his 2011 taxes, i.e., he had capital gains and was in the 15% bracket. An article in the New York Times alerted me to the fact that this provision was expiring in 2011; I forwarded the article to him, and he did in fact cash in his holdings and paid no tax on his gain. I'll try to dig up that article, or the same from another source.  

                •  You gave him wrong advice (0+ / 0-)

                  http://www.irs.gov/...

                  Look at last sentence of third paragraph.

                  You can't scare me, I'm sticking to the Union - Woody Guthrie

                  by sewaneepat on Sun Nov 11, 2012 at 06:01:37 PM PST

                  [ Parent ]

                •  No tax on capital gains: III (0+ / 0-)

                  sewaneepat: I copied the following, but stupidly didn't write down the source; no matter, as you'll see further down.

                  "WHAT CHANGES IN 2012 There are several provisions that will take effect or lapse regardless of Congressional action.

                  "One set to start in 2012 is a requirement that brokers report the purchase price on mutual funds and exchange-traded funds to the Internal Revenue Service for capital gains purposes. (They began doing this for stocks this year.)

                  "The default method of reporting is called 'first in, first out,' which could result in higher capital gains taxes if those first shares were much cheaper than more recent ones. Taxpayers have the option of electing other reporting methods, like 'last in, first out,' which benefits people who bought shares over many years, presuming those shares have appreciated.

                  "There are also two significant tax breaks set to end. One is a loophole that allows people whose marginal tax bracket is under 15 percent to pay no capital gains tax when selling securities held for more than a year."

                  HOWEVER: I also discovered a piece that expressly supports what you believe, and I did write down the source. The article ran in Forbes on 2/10/12 under the headline "How to Sell Stocks for a Profit, Pay No Capital Gains Tax." It was precisely about the no-tax provision on capital gains for low-income taxpayers.

                  If the no-tax provision is still in effect, I'll be just a bit ticked at the NY Times. It was their article alone that led him to sell; had he held onto it (it was a mutual fund), he'd have made a fair bit more money.

                  I'm unsure at this point. If I had to guess, I'd say the provision was extended sometime after the Times article, and that it expires Dec. 31, 2012, along with the other Bush tax cuts.

        •  Capital gains taxes (0+ / 0-)

          "They can keep the capital gains tax at 15% for middle income Americans."

          There's no justification, period, for taxing capital gains at a lower rate than wages; not for the wealthy, and not for middle income Americans either. Income is income and should be taxed at the same rate, no matter where it comes from.

    •  How the hell did I not know this? (2+ / 0-)
      Recommended by:
      earicicle, bluezen

      I read here almost daily. I thought I pretty much knew just about everything about Obamacare. But this is the first I have read here about that 3.8 medicare surcharge for the wealthy on unearned income. That should certainly help stabilize medicare in the future. If not, it's a good start.

      Damn, I learn something new here every day, even when I think I already know it all!

      Never attribute to malice that which can be adequately explained by stupidity.

      by reflectionsv37 on Sat Nov 10, 2012 at 10:59:08 PM PST

      [ Parent ]

      •  Me too. (2+ / 0-)
        Recommended by:
        reflectionsv37, bluezen

        This is HUGE. Someone like Romney most likely pays ZERO Medicare tax currently, since he doesn't have anything that counts as earned income. I love this!

        Ho'oponopono. To make things right; restore harmony; heal.

        by earicicle on Sat Nov 10, 2012 at 11:53:10 PM PST

        [ Parent ]

      •  Medicare tax on unearned income (1+ / 0-)
        Recommended by:
        reflectionsv37

        I definitely favor additional taxes on unearned income, but I've never been comfortable with this dedicated Medicare tax. Why? Two simple reasons: 1) Are healthcare costs the special responsibility of the rich? Not to my mind; they're the responsibility of all taxpayers; 2) To my mind, the best approach to taxing unearned income is to tax all income equally: the same tax rates, no matter where the income comes from. If this were true, there'd be no need for any special Medicare-dedicated tax on unearned income

        •  The problem is... (0+ / 0-)

          that people like Mitt Romney pay essentially no payroll taxes or medicare taxes because almost all of their income comes from unearned income. It's only fair that we all contribute to health care and that includes the rich. Right now, those on payrolls support the entire program and the rich pay virtually nothing. It's time they, with all their millions, contribute something to the program. I think this is absolutely wonderful.  I think they should also be contributing something to Social Security.

          Never attribute to malice that which can be adequately explained by stupidity.

          by reflectionsv37 on Sun Nov 11, 2012 at 03:10:31 PM PST

          [ Parent ]

          •  Taxes on unearned income (1+ / 0-)
            Recommended by:
            reflectionsv37

            "The problem is that people like Mitt Romney pay essentially no payroll taxes or medicare taxes because almost all of their income comes from unearned income."

            The best way to deal with this, to my mind, is to tax all income at the same rates. This is what the Simpson-Bowles deficit commission recommended, and the Bipartisan Policy Center's Rivlin-Domenici deficit reduction report also recommended: equal taxes on all income, no matter what the source.

            •  I would be all for that! (0+ / 0-)

              That would actually reduce the tax rates for everyone. They should also contribute something to Social Security and Medicare. Those rates would also come down if everyone contributed. I also think it will be a cold day in hell before the wealthy allow that to happen.

              Never attribute to malice that which can be adequately explained by stupidity.

              by reflectionsv37 on Mon Nov 12, 2012 at 01:39:01 PM PST

              [ Parent ]

  •  There are 25,000,000 "units" (Tax returns) (3+ / 0-)
    Recommended by:
    reflectionsv37, earicicle, BasharH

    that make over $250,000 subject to income tax. It is estimated that they will send ~400 million to the treasury next year if the tax cuts expire. ~600 million with the lower quintile tax brackets paying more.

    40,000,000 tax units make $9,000 or less and will jump from 10% to 15% taxes, so no it is bad to let everyone's tax cut expire. We need to protect the poor and working class from tax increases.

    Mitt Romney was the poster boy of capital gains at 15% -minus deductions. he made 20 million a year on investments. He was personally crudading against a 5% hike on capital gains taxes from 15% to 20%. (greedy selfish bastard)

    Many CEO's make millions+ dollars pay 35% income tax and then invest in stocks where they receive (capital gains) and pay an additional 15% on those.

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

    by Brahman Colorado on Sat Nov 10, 2012 at 10:06:16 PM PST

  •  No thanks... (1+ / 0-)
    Recommended by:
    bluezen

    No matter what we try to do, the wealthy will find ways to hide away and protect their money. Don't you worry about that. That doesn't mean we shouldn't try to reform the tax code and help them out by not raising their tax rates because just attempting it would make us tired.

    No, let them reveal whatever other loopholes they use to prevent themselves from having to pay their fair share of taxes and in time we'll close those too. There is a mandate to end the Bush tax cuts for the top 2% of wage earners. President Obama will be carrying out the American electorate's will by allowing those Bush tax cuts to expire.

    No. Extension. Period.

    The most dangerous... programs, from a movement conservative's point of view, are the ones that work the best and thereby legitimize the welfare state. Krugman

    by BasharH on Sun Nov 11, 2012 at 01:52:13 AM PST

  •  Raise minimum wage (0+ / 0-)

    TO $12 an hour with no exceptions in exchange for not raising taxes
    on those over $200/$250.

  •  Agree with author! (0+ / 0-)

    I've been a staunch PBO supporter and self-identified Democrat since I was 20 but this terminology y'all are using is not only unrealistic but won't work.

    For me, tax reform is needed. And drastically so. Cut out all the loopholes and everything unnecessary. We currently have the longest and most complicated tax code in the world and it costs 50 billion a year just for people to comply with it. Get rid of all that extra garbage so people won't be able to abuse the tax system a la Romney. Set three simple tax rates of 15%-22%-30%. Set the capital gains tax at a simple 15% for all income over a set amount. Eliminating deductions and credits in favor of lower marginal rates will yield a simpler and more efficient tax code, decreasing the burden on taxpayers.

    Lower corporate tax from 35% to 28% (which is still globally high) and seriously consider to shift from a worldwide to territorial tax system so businesses won't get double taxed.

    I understand that there is a desire to obtain higher revenues from taxes but if it also increases the costs of doing business there will be less to obtain revenues from in the first place.

    Tax holidays are bogus.

    Now, this is probably close to what a compromise on tax-reform would look like. Left of the Republicans, right of the Democrats, far-right of DKos. If you think you can get much more than this through the House (and even this might be a non-starter given flat-tax on capital gains) then you're kidding yourself.

    And the diarist is right, you won't get anywhere were you to just increase top tax bracket by X %. In fact, you'd increase the costs of the people in the 250K-500K - which isn't a huge amount - but the big fish wouldn't be fazed by this at all if loopholes remain.

  •  This sounds like Republicans' take on gun control. (1+ / 0-)
    Recommended by:
    GTPinNJ

    Something along the lines of: "Making any kind of guns illegal won't stop criminals from finding a way to obtain them and then keeping and using them illegally anyway, so why make any guns illegal in the first place?"

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