Barack Obama's tax plan reads, "middle class families will see their taxes cut – and no family making less than $250,000 will see their taxes increase."

Recently, Joe Biden has suggested a figure of $150,000 and Bill Richardson has suggested a figure of $120,000.

These may or may not be consistent with the Obama plan, depending on your reading.

Question:
If Barack Obama is elected President, what do you expect the actual threshhold for federal income tax increases for married couples filing joint tax returns will be?

Choices:
There will be no tax increases
$250,000
$200,000
$150,000
$120,000
$42,000
Other - please tell us what you think.

 

I think it will be a far cry from Senator Obama’s proposed plan of $250,000

I think it will be $100,000 because a couple making any more than that is “ rich ” and can afford to share the wealth.

Barney Frank may agree with you, Koz: "there are a lot of very rich people out there whom we can tax at a point down the road and recover some of this money."

Since half of American families make less than about $55,000-$60,000, I see the middle class centered around that figure, and think that $200,000 is where the threshold will end up. Making more than 3 times what most families make sure doesn't seem like Middle Class to me.

It'll be a tad over $250K.When this was last raised, the accountants Deloitte had calculated that at $250,000 exactly, Obama would save them $12.

Joe the Plumber is safe unless he starts earning lots as a result of his new fame as a TV celebrity and political pundit or gets himself elected to high office.

Joe and Jill Plumber, together with Joe Jr. plumbing fixture saleman, earn $250,025.00 collectively. They will save $13.75 over their current tax assessment. Scout's Honor!. If John McCain is elected, all taxes will be eliminated and everyone will be free to start small businesses and thus create jobs. Trickle-down prosperity returns to America!

Frank, you forgot that, under McCain's plan, everyone will have higher-than-average incomes.

quote:

Originally posted by DorianGreyed:
... everyone will have higher-than-average incomes.

I wish Scotty was still active to wrestle with that one.

quote:

Originally posted by DorianGreyed:
Since half of American families make less than about $55,000-$60,000, I see the middle class centered around that figure, and think that $200,000 is where the threshold will end up. Making more than 3 times what most families make sure doesn't seem like Middle Class to me.

When the Mrs. and I moved to a rural county three years ago, we entered a cost of living time warp. We purchased a home for slightly less than a lot in our old Charlotte neighborhood was listed for. And Charlotte is much less expensive to live in than many larger cities.

Thus I wonder if residents of, say, Boston or San Francisco will not be inordinately affected by a $200,000 threshhold.

quote:

Originally posted by DorianGreyed:
Since half of American families make less than about $55,000-$60,000, I see the middle class centered around that figure, and think that $200,000 is where the threshold will end up. Making more than 3 times what most families make sure doesn't seem like Middle Class to me.

On Long Island making 100-150K per household (where I think the number will end up)and living within your means is not living large or living rich by any means. The closer you get to the city the more expensive it gets. Manhattan is the epicenter of high cost living around here. For hard working people who earn that to have to pay more in taxes will hurt the economy more than it will help in my opinion. They will have less money to spend.

Serious question, isn’t “ spread the wealth ” the same as “ trickle down ” the difference being the government choosing where the money gets spent instead of the people?

Actually, it's the burden of taxes or the burden of paying for the government) that is being spread, and it has always been borne more by those who earn more (in theory; A good accountant can ease that burden considerably.). I assure you that whatever amount of tax break the middle class will get under Obama cannot by anyone's imagination be called "wealth." As I have shown in threads several times, the upper incomes have traditionally paid a much higher rate in taxes than they do now.

Which makes more sense:

Tax breaks for the wealthy in the hopes that they will invest and create jobs

Tax breaks for the middle class in the hopes that they will spend it to stimulate the economy


Investment is not going to create jobs if there is no demand for the product. At the present time, the middle class, or what remains of it, is having a very hard time making ends meet, as Koz points out. It doesn't take much thought to realize that any money that they save in taxes will be spent paying for the necessities of life.* That creates demand, which creates a need for jobs, which puts more money in the economy. More money in the economy means more jobs, more earnings, thus, more spending, etc. It also creates greater revenue for the government. All of that is a certainty. Hoping that the wealthy use their tax break to create jobs is not a certainty. (If you think it is, why have things gone downhill since bush's tax cuts? It's much more than just the mortgage situation, you know.)

McCain has made much of what he calls Obama's "expansion of welfare."

[i]"Barack Obama's plan to raise taxes on some in order to give checks to others is not a tax cut; it's just another government giveaway." - McCain, at a New Hampshire rally on Oct. 22

Yet a closer look at each of their tax plans shows that McCain's plans are more expensive, at least according to the Tax Foundation, a Washington-D.C.-based tax research organization founded in 1937, most famous for its annual calculation of Tax Freedom Day, which it has produced since the early 1970s. The Tax Foundation's stated mission is to "educate taxpayers about sound tax policy and the size of the tax burden borne by Americans at all levels of government."/URL] [URL=http://money.cnn.com/2008/10/31/news/economy/taxes_welfare/index.htm?cnn=yes]CNNMoney.com seems to agree.


*I recall someone in either Nixon's or Reagan's cabinet stating that tax breaks for the poor was not a good idea since they would spend it on "non-durable goods." Aside from the fact that the single most non-durable goods are generally called "food", non-durable goods spending puts the money immediately into the economy. Investing in a business does not.

quote:

Serious question, isn’t “ spread the wealth ” the same as “ trickle down ” the difference being the government choosing where the money gets spent instead of the people?

No, I think the idea is "spread the wealth more equitably". The past 8 years has seen a growth in income for the top bracket people and a loss of income for the bottom 95+ percent. We need to adjust that. The money gets spent by the people who have no choice but to spend it.

As to the "government choosing where the money gets spent instead of the people. Isn't it the people who decide who the government is? And shouldn't they be?

quote:
Originally posted by DorianGreyed:
Since half of American families make less than about $55,000-$60,000, I see the middle class centered around that figure, and think that $200,000 is where the threshold will end up. Making more than 3 times what most families make sure doesn't seem like Middle Class to me.
--------
On Long Island making 100-150K per household (where I think the number will end up)and living within your means is not living large or living rich by any means. - Koz


More than 3 times $55,000 does not include people "making 100-150k." Further, Obama's plan does not reach down to the upper end of that product. $180,000 isn't too close to $250,000. (From my viewpoint, they might as well be the same. Everybody's tall to a midget.) In fact, the difference between the 2 figures is still more than the median family income in the US.

McCain has persisted in claiming that Obama will raise taxes on everyone, directly or indirectly, and that everyone in business is a mythical Joe the Plumber (the real one would not be affected).Nowhere has he explained the basis for these claims.Obama, strangely, has never called for an explanation.

The claim is a distortion.The only sources are sites where 'middle class' is defined as 'those who pay the highest rate'. Typical is Heritage Foundation.It claims that the US will have 'European levels of taxation', amounting to over 56 per cent at the highest rate (including all direct taxes).Only about three European countries ( Hungary, Denmark and Germany) have a top band at or above that, so it's hardly 'European levels'.It also ignores the level at which top rate is first payable.

The same source goes on to claim that higher taxation will cause American individuals to move assets to lower tax areas e.g. France and Britain (evidently those two haven't got European levels )

Here's how someone on the good salary of 465,000 UK pounds (which is $750,000) is taxed in Britain. In the UK that person, married or not,pays 176,000 as income tax and the (maximum) national insurance contribution of 8,000, making 184,000 tax out of their 465,000 salary. The National Insurance is for the state pension and for the national health service.

Someone on the magic $250K earns 156,000 UK pounds.They'd pay National Insurance of 4,900 and income tax of 53,000 making 57,900 tax out of their 156,000 (total deductions are 37% therefore)

We have just two rates of tax. The lower is 20 per cent, payable on taxable income up to 34,800, and the higher is 40 per cent payable on the slice of taxable income above 34,800. Income is taxable after personal allowances. For an ordinary person, married or single, that means a basic 6,035 pounds. Capital gains tax is 18 per cent.