Tea Party less popular than atheists and Muslims

[mawilson 2,133]

Actually, if that were the case, the convergence means its a finite amount as a percentage of that infinite income.

Huh? The rate is a function of income and converges to 35 percent.

Limit of a function

[Zero Sum 305]

I think I've brought this up before, conveniently ignored:

If your total taxation rate, including all incidential taxes as a function of your day to day life, impact you unequally according to your income rate as compared to someone in a much higher income bracket, then yes, you are most definitely being taxed enough already.

The rich do not have this problem, and are the primary beneficiaries, if not the sole ones (given the current economical climate and the obvious push to ease up on them as a function of what they make and hide), of conservative taxation philosophy.

[Zero Sum 305]

Huh? The rate is a function of income and converges to 35 percent.

Limit of a function

Does a convergence pass its limit?

I don't think so...

I should have clarified I was talking about a finite income, not an infinite- although you did mention infinite income (which is not real).

[mawilson 2,133]

I should have clarified I was talking about a finite income, not an infinite- although you did mention infinite income (which is not real).

The income tax rate is a function of income. It always stays below 35 percent (maximum rate).

The higher your income, the closer you get to 35 percent.

The limit of f as x approaches infinity is 35. Basic calculus/analysis.

[Zero Sum 305]

The income tax rate is a function of income. It always stays below 35 percent (maximum rate).

The higher your income, the closer you get to 35 percent.

The limit of f as x approaches infinity is 35. Basic calculus/analysis.

Indeed. Think about who is subject to that never-attained event horizon...

Not exactly that need be concerned about a decreased slope the closer they get to it. But they still have a hissy fit demanding the slope gets decreased even more.

[Robert&Karen 264]

Yes, the less you earn the more everything hurts, taxes only being one item. You can't buy caviar, you can't buy a Volvo, you can't buy a house in the mountains. You need to clip coupons and search the sofa cushion for spare change. I have been there. I have even been homeless. And when you make no money you pay no taxes on April 15th, but you still need the tax due when buying a 99 cent hamburger. This should not be a surprise to anyone.

The fact that a rich guy can incorporate, put a nice car in a trust fund, write off the business expenses, and thus a $50,000 only costs him $40,000, but the "average Joe" buys a $20,000 car, takes time off work for maintenance, pays for all expenses AFTER taxes, and the car effectively costs him $40,000. Yes, I disagree with that, I wish we could ALL write off our cars as a business expense!

As for my income, I do not earn $300k from my job. It pays well but not THAT well. I am retired Army which generates an income, I have a full time job now, and I have a house I rent out from when Mom died. I have no offshore accounts, no tax havens, no loopholes. I pay for education and work costs and my accountant decides what is and is not valid.

I make more money than some but others make more than I do. One thread here asked how often you have to see your fiance. I have flown to the UK five times to see her. I can afford that. Others can afford more, others can afford less.

And I apologize for mixing up some of the messengers here. I cannot scroll back to see all the pages and I should take better care of the names, I do not want to insult anyone, I'd rather discuss the topic and not the person. Then again if some of the questions I asked were addressed in a reply we'd not go back and forth a dozen times.

[Mr. Big Dog 10,747]

I actually think he's wrong - despite the regressive nature of FICA taxes, the rich still pay more taxes as a percentage of their income.

How could they not? Mathematically speaking, as their income approaches infinity, the effective tax rate converges to 35 percent.

Of course, many wealthy individuals and taxpayers who own pass-through taxation businesses (such as LLCs) benefit from being able to reduce their taxable income by expenses they incur as part of business operations, but that's another story.

The other truth nobody wants to talk about is that many of the ultra rich don't actually converge on any 35% tax bracket since their income is simply classified as something other than earned income or salary/wage income. Carried interest and capital gains is what they call it. None of which is taxed any higher than 15%. And there's no FICA taxes due on these income categories at all - another 7.65% shaved off the tax liability vs. earned income. That's why way on top, folks get to pay well below the tax rate the middle class pays on their income. And that is why Warren Buffet is paying less than 18% - FICA and all - while anyone with an earned income less than 100th the amount of Warren's take is paying a much higher effective tax rate than he and his peers are. At least we can be honest about that.

[Zero Sum 305]

The other truth nobody wants to talk about is that many of the ultra rich don't actually converge on any 35% tax bracket since their income is simply classified as something other than earned income or salary/wage income. Carried interest and capital gains is what they call it. None of which is taxed any higher than 15%. And there's no FICA taxes due on these income categories at all - another 7.65% shaved off the tax liability vs. earned income. That's why way on top, folks get to pay well below the tax rate the middle class pays on their income. And that is why Warren Buffet is paying less than 18% - FICA and all - while anyone with an earned income less than 100th the amount of Warren's take is paying a much higher effective tax rate than he and his peers are. At least we can be honest about that.

"Loopholes"

[Robert&Karen 264]

The other truth nobody wants to talk about is that many of the ultra rich don't actually converge on any 35% tax bracket since their income is simply classified as something other than earned income or salary/wage income. Carried interest and capital gains is what they call it. None of which is taxed any higher than 15%. And there's no FICA taxes due on these income categories at all - another 7.65% shaved off the tax liability vs. earned income. That's why way on top, folks get to pay well below the tax rate the middle class pays on their income. And that is why Warren Buffet is paying less than 18% - FICA and all - while anyone with an earned income less than 100th the amount of Warren's take is paying a much higher effective tax rate than he and his peers are. At least we can be honest about that.

When a baseball star gets $5 million over 5 years and then ask it to be deferred for 20 years, their income is only $250k a year then. So yes, lower taxes.

They pay no FICA but they will also never collect social security. That's YOUR money that you get back when you retire. Why should they pay for a benefit they will never get?

I currently rent out a house that depreciates and the loss comes off my taxable income. Yes, that blew me away. But if I lose $50k equity and thus save $10k on my taxable income, the result is that when I sell the house I lose $40k in cash profits. So there is no advantage to having the deduction, I'd rather have the pocket money.

I have not seen WB's tax return but if he reinvests, buys bonds, or moves the money to other categories which negate its taxability, then that's a Congress/IRS thing, not the rich man's thing. I am sure everyone here claims all the deductions we can find, and if you qualified for one of these you'd take it too.

[Mr. Big Dog 10,747]

I have not seen WB's tax return but if he reinvests, buys bonds, or moves the money to other categories which negate its taxability, then that's a Congress/IRS thing, not the rich man's thing. I am sure everyone here claims all the deductions we can find, and if you qualified for one of these you'd take it too.

He doesn't have to do any of that. The top tax rate for capital gains and carried interest is 15%. If you derive your income - however large it may be - from these sources, then you owe 15%. That's all you owe. 15%. No tricks, no lawyers, no shelters. It's 15%. That's the second tax bracket from the bottom. And people pulling down tens or hundreds of millions of dollars - billions of dollars for that matter - pay taxes at the same rate as the second bracket from the bottom. Don't know about you but to me, there's something awefully wrong with that picture.

[mawilson 2,133]

If you derive your income - however large it may be - from these sources, then you owe 15%.

Only qualified dividends. Non-qualified dividends are taxed at the standard income tax rate.

[Robert&Karen 264]

He doesn't have to do any of that. The top tax rate for capital gains and carried interest is 15%. If you derive your income - however large it may be - from these sources, then you owe 15%. That's all you owe. 15%. No tricks, no lawyers, no shelters. It's 15%. That's the second tax bracket from the bottom. And people pulling down tens or hundreds of millions of dollars - billions of dollars for that matter - pay taxes at the same rate as the second bracket from the bottom. Don't know about you but to me, there's something awefully wrong with that picture.

Then you must hate that the rich pay the same sales tax rate as the poor, the same excise tax rate on gas and tires, and the same tax for their dog license. Is something wrong with that too?

[Zero Sum 305]

Then you must hate that the rich pay the same sales tax rate as the poor, the same excise tax rate on gas and tires, and the same tax for their dog license. Is something wrong with that too?

That was not what he was talking about. No need for slippery slopes.

[Robert&Karen 264]

That was not what he was talking about. No need for slippery slopes.

Oh, so then it is okay for some taxes to be a flat percentage and okay for other taxes to be graduated, but there is one flat tax that you think should be graduated, is that it?

[Zero Sum 305]

Oh, so then it is okay for some taxes to be a flat percentage and okay for other taxes to be graduated, but there is one flat tax that you think should be graduated, is that it?

You're slipping away...

You do understand that consumption taxes are set on a definite amount, while incomes are not a set amount in a society were consumption is a necessity? I know you exaggerate a few posts back about buying up luxuries, but most Americans probably won't find it very funny to be (if they're lucky) earning peanuts for doing an honest job that may or may not require less skills than those in the upper 1-2-3% crust.