Skip to comments.IRS: Not enough rich to cover the deficit
Posted on 08/06/2011 8:59:32 AM PDT by EBH
Soak the rich, eh?
They do not have the money.
A report from the Internal Revenue Service found that the rich 8,274 people with incomes of $10 million per year or more earned a total of $240 billion in 2009.
Even of you confiscated every dime they earned, you would barely have enough money to cover government spending for 24 days.
Of course, about a quarter of that money already goes to the federal government for federal income. So make that 18 days.
Another 227,000 people earned $1 million or more in 2009.
Millionaires averaged taxes of 24.4% of their income up from 23.1% in 2008.
They, too, did not earn enough money to come anywhere close to covering the annual deficits that are $1.5 trillion a year.
Barack Obama was the first president to sign a budget with a $1 trillion deficit into law.
In fact, all the taxpayers including the ones who get a refund check bigger than the withholding taxes they paid have the money.
From Reuters: Total adjusted gross income reported on tax returns, measured in 2009 dollars, was $7.626 trillion, down from $8.233 trillion in 2008 and $8.989 trillion in 2007. Total adjusted gross income was up only slightly from the $7.475 trillion reported in 2001, when there were 10 million fewer taxpayers. Adjusted gross income is the amount on the last line of the front page of a Form 1040 tax return.
Individual tax collections totaled $1,175,422,000,000 in 2009 or 15.4% of all income.
Doubling federal income taxes for everyone would still leave us $400 billion or so shy of balancing the budget.
We must cut. We cannot afford to buy everything we want.
UPDATE: Linked by Rush Limbaugh. Thanks.
Gee... Rush has been saying this for how many years?
Who’s going to break the news to Zer0?
But-—but -—but it sounds so good to the people who don’t work at all, when Obama says it.
It’s class war, and anyone with common sense knows it, but it’s the lie our Muslim friend keeps shouting as though it were written in stone.
The fact is we cannot pay ur debts when 50% of the American Public are paying no tax’s and being a drain on the system.
It isn't true or newsworthy unless a lefty says it.
However, we need to tax these people so that the 27,041,498 returns with Earned Income Tax Credit can get the $53,985,190,000 refundable portion - that’s $2166 per return, back in their pockets for a short time. (2009 figures. Just came out.)
They do not have the money.
Thats the 0bama agenda working.
Zer0 knows that. He is going to break the back of what is left of the rich that own or an important part of industry. This dictator is following the same path Hitler did. He will move next term to rid all guns in the hands of Americans either by confiscation or prohibit making of ammo. God help us if he gets another term.
A little math goes to show that the wealth really isn't all that concentrated and the extent to which it is yields incredible benefits.
I wondered that to yesterday when I heard Rush discussing this.
The national average wage index for 2009 is 40,711.61, but you would need to include all the profits etc. of the companies being able to employ those 13,931,000 too. And all the fee’s that go along with doing business...
But at the article points out even doubling the taxes really isn’t enough and I don’t think all those people going back to work would be enough either.
Ah...wait maybe it would be...because then there would be a natural cut in entitlements like welfare and foodstamps. ‘Course we’d have to keep the liberals hands away from it...
Its class war, and anyone with common sense knows it, but its the lie our Muslim friend keeps shouting as though it were written in stone.
The fact is we cannot pay ur debts when 50% of the American Public are paying no taxs and being a drain on the system.
Yes, it is class warfare. Corrupt wealthy individual give money to politicians in order to rig the game so that the middle class will bail out their failing companies. Many of the “non tax payers” are working 2 jobs and also raising the next generation so the well off non breeders can have nice toys. As to the national debt, everyone will have to pull together. There is no room for the “he’s not paying his fair share” garbage. It’s beyond a problem with the decisions of individuals. The system is broken and tweeking it won’t work. We can start with eliminating the drain put on our country by the illegals.
America has been a socialist country for many decades..
SSA (social security) is PURE socialism.. and I mean PURE..
Many are socialists now.. and many more hope to become outright socialists SOON..
Did I say SSA is pure socialism?.. AH!yes...
The american people have been quite thoroughly brain washed..
I’m sure that some smart people are perusing FR.
Much is completely kept secret from the public by simply not covering it in the media.
Most liberals love the idea of making the “rich pay their fair share”, but they shut up completely if you invite them to all pay a fixed percentage of income with no deductions. By my calculations, it takes about 6% to produce more government tax revenue than Income Tax Code produces, which would enable elimination of the IRS completely and replacing it with a skeleton crew that collects a simple percentage - much the way States collect Sales tax.
Fantastic results could be obtained by a) making it a Constitutional Amendment and b) having the Amendment require that ALL SURPLUS be returned to taxpayers proportionate to how much they paid and c) including in the Amendment the prohibition for the government to BORROW - completely prohibit BORROWING - just have the current bonds paid off out of surplus.
This would make everyone who had a job want government to DECREASE spending - so they would get a bigger surplus check. And Congress would be pressured to return a surplus by overwhelming majority. And Congress could not borrow to fund spending. That arrangement would be an automatic, locked-in, balanced budget framework that would require ratification of an Amendment to get around.
I repeat this idea I posted previously...
Did you know - that the Federal deficit for 2011 - was $490 billion larger than the total Income Tax collected for the year ?
2011 Deficit = $1,645.3
2011 Total Income Tax collected = $1,154.4
Revenue For 2008, in billions:
Individual Income Tax: $1,145.8
Corporate Income Tax: $304.3
Revenue For 2011, in billions:
Individual Income Tax: $956.0
Corporate Income Tax: $198.4
For all the work that goes into planning and preparing for corporate income tax - IT NET ONLY $198 BILLION ?????? WHAT ????
It jumped out at me that ALL corporations in America, in total, for 2011, paid less than $200 billion in corporate income tax. Now that’s “tax efficiency”. It starts to makes sense. You’ve got GE paying... zero. Ok, I get it.
With this TINY amount of revnue, this got me to thinking that perhaps the situation screams out for a flat tax. What is the point of all those tax gyrations to collect a lousy $200 billion ?
I’ve always liked the idea of a pure flat tax, but kind of ignored the idea until now.
What would we need in a flat tax rate in order to replace that revenue ?
Well, I said to myself, self, let’s be fair. Let’s have corporations and individuals pay the same rate. Both are financial entities. Part of getting the legal protection of a corporation for the shareholders having an “entity” is, well, they have an entity.
Mind you, I have a personal services “C” corporation, so I’m getting double-whammied myself. So I’m that last person on earth to want to “rip off” corporations or make them pay overly burdensome taxes. But I readily admit that in exchange for having the legal protections of a corporate entity, I have expect to pay something for that separate entity.
Now, what’s the tax base for the entire U.S. ?
Let’s work with 2010, I happen to have some numbers (in billions) handy by.
All business revenue: $13,514.1
All personal income: $12,530.0
Gee Wally, that sounds like a total tax base of $26,044.1 billion (26 trillion).
Now, we have a 1099 reporting system for capital gains in place in America where we already separate short term from long term gains, with 1 year being the time required for an asset to be held to qualify for long term treatment. And that’s a nice thing to have, a lower rate for long term gains: it taxes traders at a regular income rate like everyone else. Long-term investors, like mom and pop (or you and I) receive a tax benefit for staying invested in a company for at least one year, increasing market stability and moderating the boom and bust of speculative trading (i.e., if speculators received a tax break it would attract tons of speculators). If stocks are held many years - that’s automatically deferring taxes on gains until they are realized, when the stock is sold. Grandpa had stocks he held for decades - we can too. IRA and 401(k) accounts are only a ruse by the government to have control of the portfolio of individuals - to dictate to them what they can and can’t buy, and to enable the government at any time to change the rules and confiscate wealth or income. Most importantly, it inhibits the ability of individuals to move money out of that account to invest in something else. It helps the purveyor of “qualified plans” to keep investors money with them instead of being yanked out and invested in a strip mall or your own coffee business.
So just what is the tax base for “long-term” capitals gains ? Most recently, just under 1 trillion per year. It matters not whether this was gains by persons or corporations, because we’re putting them at the same rate. And what rate ? I picked 6%; and said let’s have a very encouraging long-term capital gains at half that, 3%. Nice round numbers. Easy enough to put them into a Constitutional Amendment.
And the tax revenue that would have been collected ? $1,472.65 billion.
What ? That’s over $380 billion more than the $1,089.9 that was collected in 2010.
We could safely eliminate the IRS, have plenty of revenue - and everyone - everyone - would be paying the same 6 cents for every dollar of regular income.
The long term capital gains does not make much difference in tax revenue, as the tax revenue lost to the discounted rate of 3% is only around $30 billion.
There would be no “encouraging” different behaviors by having different deductions, tax returns would be one simple page, the only ones that need file a return would be businesses to provide their sales records, much the same way sales tax is already collected in different states.
Some say that 6% of revenue for business would be impossible for businesses run on close margins - not true, because all their competitors would also have the same tax. Businesses who run with very little profit would have to raise their prices.
Social Security and Medicare is separately funded by those deductions, which, for purposes of this discussion, simply continue as they are. Everyone’s paycheck stub would simply show 6% withheld for federal income tax and that would be that, end of story. Everyone’s 1099 for other types of income - 6% withheld for federal income tax.
Corporations - file a return every month or more often for higher volumes (like sales taxes already work) with your sales figure, times 6% to calculate tax and send a check. All the rest of your corporate income tax planning and forms - out the window.
Posted to Twitter. I changed the privacy settings on my facebook account and suddenly it’s “temporarily unavailable”.
Wrong set of figures. To the Obamanations, $250K is rich enough to punish.
Why go viral when we have been blessed with peace of mind? Here’s an excerpt from today’s news:
“a federal government program called the Universal Service Fund came to the Keystone State and some residents are thrilled because it means they can enjoy 250 minutes a month and a handset for free, just because they don’t have the money to pay for it.”
“Gary Carter, manager of national partnerships for Assurance” (explains that) “Free cell service means “one less bill that someone has to pay, so they can pay their rent or for day care...it is a right to have peace of mind”
i have posted it several times over on Boehner’s page. He is being inundated with looney lefties...
Tax simplification and broadening the tax base might help. But then you need cap and balance.
How do we make this go viral?
Someone more clever than me needs to to put this into simple visual graphics for even the Dems to understand and put it onto Youtube
Is that all taxes or federal income tax only?
The first tax increase should be to have the 51% who pay no tax start paying tax. When that’s done we can discuss raising taxes on the already over taxed productive members of society.
Told ya it was a spending problem.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.