Posted on 09/25/2012 5:13:15 AM PDT by SeekAndFind
Everyone's getting their knickers in a twist about the 47 percent that Mitt Romney figures are going to vote for Barack Obama, no matter what. But do you know why they will vote for Barack?
Wyatt Emmerich did the math back in 2010 for The Clevelend Current in Mississippi. It's been written up at ZeroHedge and by Kathy Shaidle.
The message is simple. Earn $3,600 per year as head of a family of three, and your net earnings (after taxes and government benefits) will amount to $31,630. But if you earn $60,000 a year, your net earnings will be $34,366. In other words, if you work your tail off and increase your earnings by $56,400, you will be only $2,736 ahead in take-home pay. The reason is that your government benefits will be cranked down from $30,762 a year to zero, and your taxes (including child care) will crank up from $2,787 a year to $25,634. Talk about chump change.
But I am not interested in the raw numbers; I am interested in the science behind the numbers. It is true that I never read "Science Tuesday" in The New York Times or listen to "Science Friday" on NPR, but I am still interested in science. In this case, of course, the science in question is economic science. It is the branch of economic science called "marginal economics" that came in ten years after Karl Marx nailed his colors to the labor theory of value in Capital.
Marginal economics solved the problem that had hag-ridden the classical economists. How could a jewel, that has high exchange value but low use value, be more valuable than a tractor that has low exchange value but high use value? The answer was that use value and exchange value are meaningless concepts.
(Excerpt) Read more at americanthinker.com ...
Insofar as the person working 16x harder nets a couple thousand more, we can assume most of that goes to business expenses (attire, transportation, etc.).
We’ve actually had the same conversation.
As we don’t have children, and the city/state services frankly suck, we get very little benefit from the enormous amounts of taxes we pay.
It’s tempting to divorce her and live together - maybe even “rent” part of the house to her - and let her get some of the assistance that’s available. We could probably make out pretty well.
Sometimes I think the only solution left is to help collapse the corrupt system we have.
“The conversation came up at tax season with our estate attorney that we might consider a “legal divorce” in order to reduce tax basis by filing separately.
Pretty damn sad when that conversation comes up.”
Years ago during the Clintoon years before Newt rammed the tax decreases through, we were maxed out on our 401’s, HSA’s and IRA’s. I had an excellent sales the year before with an excellent bonus paid that year. My wife had gotten a good raise. So our Income had really ballooned up from previous years.
In December we got a call from our CPA, a lady who, also, went to our church, whom we had known for decades. She suggested that we fly to a quickie divorce country and get a divorce for tax reasons. My wife didn’t speak to her for a couple of months. We didn’t fly and divorce.
Flash forward a couple of years, and my company offered me an excellent retirement. The retirement income came in a bundle in Jan the next year. Thanks to the Clintoon’s tax policy, I couldn’t buy into the company 401K and could fund an IRA for the measly 2 k maximum. The Max of FICA and Medicare were deducted from the lumpsum with the estimated taxes for that coming year.
After looking over the offer and crunching the numbers, the same accountant called us in at the end of the year and told us that I should not work at all the first year as we were going to be killed with what she call Hilliarly’s tax policies which handled that retirement like a sales bonus. She said that we would probably have borrow from our 401K to help pay for the extra taxes that year. Fortunately, somehow the company had its 401k that allowed withdrawals at age 55 if we were retired. I was 56, and we did borrow to pay for the taxes. I didn’t work that year, and my wife didn’t speak to our friend for a few weeks again.
Obamacare has changed(and is still ‘evolving’) what can be paid for via FSA/HSA. Careful you don’t end up with $ that ends up being forfeited back to Uncle Scam since you couldn’t use it all up.
Yes, you have to be careful with an FSA. But, an HSA can be rolled over indefinitely. Once you reach 59-1/2, it effectively becomes an IRA -- you can use the remaining funds for anything.
bttt
I’m not sure where this person got his numbers, but first of all you have to assume that if he’s making gross of 60k he’s not contributing to retirement or healthcare costs and he also must not be taking any deductions what so ever. He apparently isn’t taking advantage of the child tax credit or their deductions and also would seem to be self employed.
Basically that’s a self employed guy not taking advantage of anything the tax code gives him. Quite frankly it’s just my argument for why the tax code is jacked up. You deduct enough benefits like 401k, IRA, Health insurance, etc., to allow for you to limit your income quite a bit, then you can get to a point where you can get the Earned Income Tax Credit and pay even less. I would guess that a family making 50,000 a year working for an employer that offers direct benefits would probably get a tax refund and essentially pay zero in income taxes(and it’s possible to get money back), oh yeah just through taxes you can get 6k-7k returns when you earned only 20k a year. I would bet that there would be larger families say with 5 or 6 kids that could easily zero out income taxes at maybe even 80k a year. Sure on payroll taxes you have to pony up but income taxes are essentially non existant on middle income families.
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