IRS: Not Enough Rich to Cover Deficit

[Deleted]

The reason they pay no income taxes is because businesses are not withholding them -

I can comment on this in a limited way. My wife works part time on a military base. The part time job pays pretty much minimum wage. I know at the end of the first year we had to pay a pretty good chunk in taxes because the government took almost no tax out of her check. The pay section "assumed" that it was her only paycheck (total income) & had it been she wouldn't have owed taxes on it. Of course at the end of the year that total was added to our other income & ZAP!

You can of course correct that by telling businesses (or whoever is paying you) to take out taxes. We ended up just telling them to take a certain amount out each payday regardless of what she makes.

Oh & for all of you Walmart haters that don't like them because they don't pay a fair wage. The government is much worse than WM if your talking lower level jobs. My wife is actually listed as an office automation clerk as both her job description & pay level. She is actually an office manager which would have a much higher pay scale (she does nothing that's in the job description of an automation clerk). Doesn't matter to her about the money but I thought that I would give you guys a hint that the government does it too.

[ameiko]

Aug 7, 2011 10:04:14 GMT -5 @patstab said:

I read in the WSJ that by letting the tax cuts expire we could generate $1.2 trillion per year to pay on the $1.4 trillion per year deficit we are creating, so cut $.2 trillion and we are even and then can tackle the past debt.

It will make a huge difference over time. We all paid it before and never even felt it, intially it would be felt mainly by lower income folks the most, upper it isn't even a drop in the bucket.

We never got anything out of any tax cuts so its not going to matter to us one way or another.

I know that's not correct. The estimate I have heard, regarding the top tax brackets it that it *might* generate 800 billion OVER TEN YEARS or 80 billion per year... 5% of the 1;6 trillion deficit I hear tossed around.

No way it's 1.2 trillion each year.

Indeed, if one reviews the CBO numbers, tax revenues surged after the 2003 tax cuts. To think that they are costing us money makes little sense and lacks evidence.

[shelby]

Aug 7, 2011 8:02:08 GMT -5 2kids10horses said:

Ok, Shelby,

A question for you...

Let's say I am a speculator. I buy gold today, but I don't do anything with it (like making jewlry), I just hold it in coins and bars, and hope the price goes up. To sell it later at a higher price.

But, I have to hire a bookeeper to keep track of my holdings. I hire a security guy to guard the stuff.

Now, I've employed labor.

I guess I'm no longer a "Speculator"! Am I right?

I'm pretty sure realize the different ends of the value added spectrum a gold speculator and a retailer are on. The retailer employs many and brings goods to market (whether he pruduces them or not) and a gold speculator holds goods from market to drive the price up and in your scenario employed 2 people. So yes you are still a speculator and added walue is close to none.

[shelby]

Aug 7, 2011 10:08:03 GMT -5 ameiko said:

Aug 7, 2011 10:04:14 GMT -5 @patstab said:

I read in the WSJ that by letting the tax cuts expire we could generate $1.2 trillion per year to pay on the $1.4 trillion per year deficit we are creating, so cut $.2 trillion and we are even and then can tackle the past debt.

It will make a huge difference over time. We all paid it before and never even felt it, intially it would be felt mainly by lower income folks the most, upper it isn't even a drop in the bucket.

We never got anything out of any tax cuts so its not going to matter to us one way or another.

I know that's not correct. The estimate I have heard, regarding the top tax brackets it that it *might* generate 800 billion OVER TEN YEARS or 80 billion per year... 5% of the 1;6 trillion deficit I hear tossed around.

No way it's 1.2 trillion each year.

Indeed, if one reviews the CBO numbers, tax revenues surged after the 2003 tax cuts. To think that they are costing us money makes little sense and lacks evidence.

What I don't understand about those opposing tax increases is you seem to want to leave no stone unturned in finding ways to cut but scoff at 80 billion a year in revenue.

[mwcpa]

pat....
the number you saw was over ten years, not per year....but still something to not sneeze at....

www.washingtonpost.com/blogs/fact-checker/post/revisiting-the-cost-of-the-bush-tax-cuts/2011/05/09/AFxTFtbG_blog.html

"Over the 10-year period, the overall size of the tax cut dropped about 5 percent, or $65 billion, to $1.285 trillion. Some people might call that a rounding error in the context of a ten-year federal budget."

[Deleted]

I read in the WSJ that by letting the tax cuts expire we could generate $1.2 trillion per year to pay on the $1.4 trillion per year deficit we are creating, so cut $.2 trillion and we are even and then can tackle the past debt.

I know that's not correct. The estimate I have heard, regarding the top tax brackets it that it *might* generate 800 billion OVER TEN YEARS or 80 billion per year... 5% of the 1;6 trillion deficit I hear tossed around.

No way it's 1.2 trillion each year.

Sadly both political parties use whatever method of naming numbers most makes them look good. My guess is that both numbers you have heard are totally wrong. As a matter of fact I doubt that anybody really knows the correct number.

A case in point was our "compromise" spending cuts. They aren't really a cut at all. Spread out over 10 years & paying 10 years of interest they cost MORE. In normal everyday language a cut that costs more isn't a cut. In government language a cut can really mean spending a billion (or trillion) dollars MORE. Again the truth is that all of this is for POLITICAL GAIN. They don't give a shit about our economy or the American people.

I still say that the Tea Party is the greatest thing that has happened to American Politics in the last 50 years & that's greatest thing for both liberals & conservatives. The fact that they won some seats in the government means that both Democrats & Republican parties have to realize that there are unhappy people out there....No make that unhappy VOTERS. That's enough unhappy voters to elect someone & if nothing else be a spoiler party for future elections. Hopefully that with scare them enough that they will start listening to Americans instead of dictating to them & trying to brainwash them (which I hate to say is pretty darn easy).

[shelby]

"I still say that the Tea Party is the greatest thing that has happened to American Politics in the last 50 years & that's greatest thing for both liberals & conservatives. "

I guess it is how you look at it if you believe it is a grassroots movement(which I don't) to get people talking about our issues and a new dialogue then yes. Or if you see the extremism and intollerance that has made our politics more divisive and angered from both sides then no.

[djAdvocate]

Aug 7, 2011 10:08:03 GMT -5 ameiko said:

Aug 7, 2011 10:04:14 GMT -5 @patstab said:

I read in the WSJ that by letting the tax cuts expire we could generate $1.2 trillion per year to pay on the $1.4 trillion per year deficit we are creating, so cut $.2 trillion and we are even and then can tackle the past debt.

It will make a huge difference over time. We all paid it before and never even felt it, intially it would be felt mainly by lower income folks the most, upper it isn't even a drop in the bucket.

We never got anything out of any tax cuts so its not going to matter to us one way or another.

I know that's not correct. The estimate I have heard, regarding the top tax brackets it that it *might* generate 800 billion OVER TEN YEARS or 80 billion per year... 5% of the 1;6 trillion deficit I hear tossed around.

No way it's 1.2 trillion each year.

Indeed, if one reviews the CBO numbers, tax revenues surged after the 2003 tax cuts. To think that they are costing us money makes little sense and lacks evidence.

if you exclude OTA Paper 81, i would agree. however, according to table 2 on page 17 of that report, the tax cuts resulted in significant revenue losses accounting for all other factors.

[Deleted]

No way it's 1.2 trillion each year.

Income tax rates would have to double to get to that number. The U.S. brought in about 1.2 trillion in income taxes before refunds last year.

www.irs.gov/taxstats/article/0,,id=102886,00.html

[Deleted]

According to Obama's own budget proposal:

Those numbers, however, don't include additional tax revenue from letting Bush era tax cuts for the wealthy expire at the end of 2012. Letting those tax cuts expire would generate an additional $709 billion over the next decade, according to the budget proposal.

money.msn.com/tax-tips/post.aspx?post=02b8cc74-102d-49f9-aa31-ebfd96e030a2

[djAdvocate]

Aug 7, 2011 10:38:20 GMT -5 @anne81 said:

According to Obama's own budget proposal:

Those numbers, however, don't include additional tax revenue from letting Bush era tax cuts for the wealthy expire at the end of 2012. Letting those tax cuts expire would generate an additional $709 billion over the next decade, according to the budget proposal.

money.msn.com/tax-tips/post.aspx?post=02b8cc74-102d-49f9-aa31-ebfd96e030a2

the numbers i have heard vary between this one and $1T. the $1.2T/year number is complete nonsense.

[bubblyandblue]

Yes, they pay "taxes" directly or indirectly, but many of them still pay no INCOME TAXES, yet receive all the benefits that those taxes provide. "
The reason they pay no income taxes is because businesses are not withholding them - The businesses are taking advatage of illegal acts of not withholden taxes to undercut their competitors - Don't you think this should be addresses under our current laws - don't you think the USA should go after the true criminal acts.
.



""Where the hell are you getting THAT nonsense from?

Not to mention the fact that if the IRS knew that businesses were not with holding and then paying the government those taxes, do you REALLY think that the IRS would just twiddle its thumbs and NOT go after them?"

REALLY?

Wow, dumbest comment I've seen here in at least the last week.

Anyway, people aren't paying federal income taxes because legally they are not taxed at those income levels, especially with the various deductions. Indeed, many get the EIC where they actuallt get money from the government.""

One of the roots of the problem in revenue is that workers have been earning less - adjusted for inflation - therefore less revenue - not to mention the high unemployment. When an illegal alien is hired to do work at lower wages - the employer is lowering his cost of doing business by avoiding the payment of different taxes and insurance and paperwork that go along with normal employment at any wage. This artificial and illegal wage structure creates an unfair competition in the "free-market".

"Not to mention the fact that if the IRS knew that businesses were not with holding and then paying the government those taxes, do you REALLY think that the IRS would just twiddle its thumbs and NOT go after them?" -

Ever heard of enforcement efforts to deport illegal aliens - do you think the IRS has filings from those workers or have with holding taxes from the employer for those folks? - Sure- the IRS should go after those employers but, I have not heard of any such enforcements - even during the heated debates about immigration. Maybe their are some vested interests hanging around this issue?

"REALLY?

Wow, dumbest comment I've seen here in at least the last week." - Well I suppose it would take one who is much better versed is dumb comments to point this out - do you feel better?

[bubblyandblue]

I heard that the top 25 Hedge Fund Managers make something like 1 trillion dollars combined and pay around 15% in taxes - so I guess they pay around 150 billion in taxes. Using the same reckoning, if thay paid a 30% tax rate, they would be putting in 150 billion more per year which comes out too 1.5 Trillion in one decade.

[bubblyandblue]

Speculation is the holding out of use while others add value.
Buy a home and not live in it - hold it out of use to wait for a rise is speculation.
From 1923 - real estate speculation -
The crash of the boom of 1923 was due to the same causes that wrecked the wall street stock market. People sold what they did not own. They made a payment down in the hope of getting the property off their hands before it began to burn. Real estate fell into the hands of sharp-shooting gamblers who had no interest in land. To them it was just a pile of blue chips on a roulette wheel.

[bubblyandblue]

I find it astounding that a private company - a rating house - can downgrade our credit rating on political grounds.
I find the action boardering on giving aide to the enemy. It has been long known that terrorist orginizations have been after our financial sector - they brought down the world trade center towers. So, however small the impact on our credit rating, it opens up the door- a wound - that they probably want to exploit. Should we be raising our defenses to this sort of thing?

[Deleted]

I heard that the top 25 Hedge Fund Managers make something like 1 trillion dollars combined and pay around 15% in taxes - so I guess they pay around 150 billion in taxes. Using the same reckoning, if thay paid a 30% tax rate, they would be putting in 150 billion more per year which comes out too 1.5 Trillion in one decade.

From the NY Times:

But in a startling comeback, top hedge fund managers rode the 2009 stock market rally to record gains, with the highest-paid 25 earning a collective $25.3 billion, according to the survey, beating the old 2007 high by a wide margin.

Doubling the tax rate on hedge fund managers would only bring in 3.8 billion more a year - or 38 billion over a decade. That's not going to put much of a dent in our deficit. The US government is spending about 10 billion per day!

I find it astounding that a private company - a rating house - can downgrade our credit rating on political grounds.
I find the action boardering on giving aide to the enemy.

The threat to the economic health of the U.S. is very real. The belief that raising taxes on the rich only will solve our problems is hiding the depth of our issues. We have a lot of foreign creditors that are very worried about our obligations.

[AgeOfEnlightenmentSCP]

Aug 7, 2011 10:38:20 GMT -5 @anne81 said:

According to Obama's own budget proposal:

Those numbers, however, don't include additional tax revenue from letting Bush era tax cuts for the wealthy expire at the end of 2012. Letting those tax cuts expire would generate an additional $709 billion over the next decade, according to the budget proposal.

money.msn.com/tax-tips/post.aspx?post=02b8cc74-102d-49f9-aa31-ebfd96e030a2

We're borrowing over a trillion dollars a year. $709 billion over 10 years? You must be joking. And of course, the estimates are high because they don't include the costs of the unemployed.

We need more tax payers, not higher taxes. We need more W-2's going out, not more taxes from the wealthy coming in.

Besides, the numbers are in from the IRS. The debate is over. The math is the math.

[AgeOfEnlightenmentSCP]

Aug 6, 2011 17:30:48 GMT -5 handyman2 said:

BubblyBlue: Not to burst your or anyone elses bubble but with or without the Tea Party the situation we are in today would have still materialized. This has been a long time building, long before the tea party.

Problem would be WORSE- much worse without the TEA Party.

[AgeOfEnlightenmentSCP]

Aug 6, 2011 13:07:21 GMT -5 djAdvocate said:

Aug 6, 2011 13:02:28 GMT -5 @bubblyandblue said:

"Education is a responsibility of the states and the BILLIONS and BILLIONS of dollars spent on and by the Department of Education have not improved the quality of education in this country one iota. As a matter of fact, it has only gotten worse!! "

True - and this indicates problems that are more fundamental than the dollars being spent - for most of the time the USA had the best education system on the planet - it appears that when vested interests, politics and privitization get mixed in the quality goes down. I don't know about you but the every child left behind program didn't help and, in my view, that program was an attempt to back-door privitization efforts. Why would private companies be so interested in education - because they know when they get it privatized they will be able to suck it dry - it would be a fantastic cash cow - and being so important to all Americans - they know they would have the privalege of a quasi monopolistic enterprise. - Ultimatley, in my opinion and my 99.9999% certainy - it will cost us all much more.

instinctively, i know that putting public education in a bathtub and drowning it is a bad bad move. we need more engineers, not lawnmower mechanics. we need more innovators, not burger flippers. we are not going to get them without a basic good education. i am wealthy, with one child, and i can BARELY afford to send him to private school. it is pretty clear that most people can't manage to do that. there are simply not enough rich kids to give us the talent we need to thrive as a nation.

we should really get back to basics at the federal and state level, and look WORLDWIDE at what works, and stop fucking around with NCLB and other horseshit that is taking us 180 degrees in the wrong direction-and turning our kids into test robots, and our teachers into test administrators.

I don't know who we need doing what- and I think it's a waste of time to try to figure it out. Who cares? It's like saying "we need to find an alternative to crude oil". The market will let us know. All "we" need to do is stay the hell out of the way, enforce contracts, keep order, and defend the country.

[Deleted]

BubblyBlue: Not to burst your or anyone elses bubble but with or without the Tea Party the situation we are in today would have still materialized. This has been a long time building, long before the tea party.

The Tea Party is a reaction to our debt. DH was reminding me of Ross Perot and his talks on the debt - the writing has been on the wall for awhile.

[AgeOfEnlightenmentSCP]

Aug 7, 2011 18:26:50 GMT -5 @anne81 said:

BubblyBlue: Not to burst your or anyone elses bubble but with or without the Tea Party the situation we are in today would have still materialized. This has been a long time building, long before the tea party.

The Tea Party is a reaction to our debt. DH was reminding me of Ross Perot and his talks on the debt - the writing has been on the wall for awhile.

The TEA Party has been around since our founding. It's a longsuffering bunch of citizens quietly going about their business. They've just recently spoken out. But we've been here- saying essentially the same thing- for centuries.

And we aren't going to crawl away with our tail between our legs and shut up.

It's game on.

[djAdvocate]

Aug 7, 2011 17:20:25 GMT -5 AgeOfEnlightenmentSCP said:

Aug 6, 2011 13:07:21 GMT -5 djAdvocate said:

instinctively, i know that putting public education in a bathtub and drowning it is a bad bad move. we need more engineers, not lawnmower mechanics. we need more innovators, not burger flippers. we are not going to get them without a basic good education. i am wealthy, with one child, and i can BARELY afford to send him to private school. it is pretty clear that most people can't manage to do that. there are simply not enough rich kids to give us the talent we need to thrive as a nation.

we should really get back to basics at the federal and state level, and look WORLDWIDE at what works, and stop fucking around with NCLB and other horseshit that is taking us 180 degrees in the wrong direction-and turning our kids into test robots, and our teachers into test administrators.

I don't know who we need doing what- and I think it's a waste of time to try to figure it out.

and i think it is a waste of time trying to figure out what this sentence means.

[formerexpat]

I heard that the top 25 Hedge Fund Managers make something like 1 trillion dollars combined and pay around 15% in taxes

Seriously, doesn't anyone research shit???

www.taxfoundation.org/news/show/250.html

Top 1% total AGI = $1.7 trillion. And the top 25 people of 1.4 million returns supposedly make $1 trillion of it?? JFC people, JFC.

[djAdvocate]

Aug 7, 2011 20:24:38 GMT -5 formerexpat said:

I heard that the top 25 Hedge Fund Managers make something like 1 trillion dollars combined and pay around 15% in taxes

Seriously, doesn't anyone research shit???

www.taxfoundation.org/news/show/250.html

Top 1% total AGI = $1.7 trillion. And the top 25 people of 1.4 million returns supposedly make $1 trillion of it?? JFC people, JFC.

someone is off by a factor of 1000. happens a lot.

[ameiko]

Aug 7, 2011 10:21:18 GMT -5 shelby said:

Aug 7, 2011 10:08:03 GMT -5 ameiko said:

I know that's not correct. The estimate I have heard, regarding the top tax brackets it that it *might* generate 800 billion OVER TEN YEARS or 80 billion per year... 5% of the 1;6 trillion deficit I hear tossed around.

No way it's 1.2 trillion each year.

Indeed, if one reviews the CBO numbers, tax revenues surged after the 2003 tax cuts. To think that they are costing us money makes little sense and lacks evidence.

What I don't understand about those opposing tax increases is you seem to want to leave no stone unturned in finding ways to cut but scoff at 80 billion a year in revenue.

1. We disagree with the estimate that raising the taxes will enhance revenue, especially in light of the CBO numbers that showed a surge in revenue following the 2003 tax cuts. There is simply no evidence that tax hikes lead to increased revenue with the one exception of the tax hikes that occured in the middle of a powerful but ultimately unsustainable tech boom.

2. As sad as it is, a "mere" 80 billion is nothing compared to the out of control spending that has occured over the last few years. Heck, it won't even cover the baseline increases that the federal budget gives itself every year.

Since the issue is NOT revenue but spending, then CLEARLY we should focus on spending. History supports this: no matter how many new tax sources we grant the government, they still outspend it. We must not give mixed messages but instead focus on the ONE message and ONLY message that the government needs: STOP SPENDING!

3. Tax hikes will hurt the economy and, as history has shown, actually lower revenue which will only make things worse.

4. Quite frankly, it's not fair to keep expecting other people to pay for the "generousity" of the left. We need to instead get back to basic and send the message that you should support and finance your own causes, not steal money from others to support non constitutional acts.

[ameiko]

Aug 7, 2011 10:32:33 GMT -5 shelby said:

"I still say that the Tea Party is the greatest thing that has happened to American Politics in the last 50 years & that's greatest thing for both liberals & conservatives. "

I guess it is how you look at it if you believe it is a grassroots movement(which I don't) to get people talking about our issues and a new dialogue then yes. Or if you see the extremism and intollerance that has made our politics more divisive and angered from both sides then no.

Again, nonsense. We are not more divisive than we were since the beginning of this nation when we had the Anti-Sedition Act, the Whiskey Wars, or the Civil Wars.

I was listening to Hannity today with Orrin Hatch and it's so interesting to listen to the various battles that hatch was involved with and many of them were as nasty as anything that happens today.

That the Tea Party is somehow poisoning the aura of civility in the nationa's capital is ludicrous! Heck, it's been over a hundred years since we saw Congressman Preston Brooks beat Senator Charles Sumner with a cane on the Senate floor!

Certainly, they were not the ones likening Bush to Hitler, nor the ones encouraging SIEU thugs to violence, nor the ones who endow Obama with his arrogant demeanor as he "kicks ass", "brings a gun to a knife fight", puts his "foot on the throat of BP" (actually one of his cronies), or crows "we won" and "elections have consequences.

The Tea Party is many things, certainly hard driving and passionate, even courageous in holding to their beliefs. There is nothing extreme in believing that the federal government taxes too much, spends too much, and interferes with our lives too much. If you honestly have issue with that, especially in light of the explosion of federal growth from 2007, the last GOP budget with a budget deficit of 160 billion, to today's 1.5 trillion without even TARP (since repaid) or a stimulus package to explain it, I would suggest that YOU are the extremist.

Yes, the Tea Party held fast to their stance to not raise taxes and God Bless them for it. Hiking taxes is mathematically and historically the wrong move. Even Hillary Clinton acknowledge that raising taxes (in this case the capital gains tax) would lead to lesser revenue.

But, again, even if I accept the premise that removing the Bush tax cuts for the "rich" will lead to 80 billion/year or that removing the tax cuts for everyone will lead to 120 billion/year, this still will only cover about 5 to 7% of the problem and will be wiped out in a year or two of increased baseline spending.

That anyone thinks that hiking taxes is the solution, in light of this, well to me that is extreme.

[ameiko]

Aug 7, 2011 10:44:05 GMT -5 djAdvocate said:

Aug 7, 2011 10:38:20 GMT -5 @anne81 said:

According to Obama's own budget proposal:

Those numbers, however, don't include additional tax revenue from letting Bush era tax cuts for the wealthy expire at the end of 2012. Letting those tax cuts expire would generate an additional $709 billion over the next decade, according to the budget proposal.

money.msn.com/tax-tips/post.aspx?post=02b8cc74-102d-49f9-aa31-ebfd96e030a2

the numbers i have heard vary between this one and $1T. the $1.2T/year number is complete nonsense.

First off, thanks for the mention of the paper. I'll read it when I get a chance.

I think the 1.2 trillion over ten years refer to all Bush tax cuts on all levels of income.

[ameiko]

Aug 7, 2011 10:44:05 GMT -5 djAdvocate said:

Aug 7, 2011 10:38:20 GMT -5 @anne81 said:

According to Obama's own budget proposal:

Those numbers, however, don't include additional tax revenue from letting Bush era tax cuts for the wealthy expire at the end of 2012. Letting those tax cuts expire would generate an additional $709 billion over the next decade, according to the budget proposal.

money.msn.com/tax-tips/post.aspx?post=02b8cc74-102d-49f9-aa31-ebfd96e030a2

the numbers i have heard vary between this one and $1T. the $1.2T/year number is complete nonsense.

First off, thanks for the mention of the paper. I'll read it when I get a chance.

I think the 1.2 trillion over ten years refer to all Bush tax cuts on all levels of income.

[ameiko]

Aug 7, 2011 14:02:55 GMT -5 @bubblyandblue said:

I heard that the top 25 Hedge Fund Managers make something like 1 trillion dollars combined and pay around 15% in taxes - so I guess they pay around 150 billion in taxes. Using the same reckoning, if thay paid a 30% tax rate, they would be putting in 150 billion more per year which comes out too 1.5 Trillion in one decade.

How hysterical is the above?

I mean, really. They would average an INCOME of 40 billion each or about half the total net worth of a Warern Buffet or Bill Gates.

Seriously, did ANY thought pass as you wrote that? ANY?!?!?

[djAdvocate]

Aug 7, 2011 21:13:26 GMT -5 ameiko said:

Aug 7, 2011 14:02:55 GMT -5 @bubblyandblue said:

I heard that the top 25 Hedge Fund Managers make something like 1 trillion dollars combined and pay around 15% in taxes - so I guess they pay around 150 billion in taxes. Using the same reckoning, if thay paid a 30% tax rate, they would be putting in 150 billion more per year which comes out too 1.5 Trillion in one decade.

How hysterical is the above?

I mean, really. They would average an INCOME of 40 billion each or about half the total net worth of a Warern Buffet or Bill Gates.

Seriously, did ANY thought pass as you wrote that? ANY?!?!?

it was either a careless mistake or some really bad math.