Saturday, September 18, 2010

change in tax burdens if "Bush tax cuts" expire

Many on the Left want to extend the Bush tax cuts that impacted the middle-class and upper-middle class. But some on the Left have claimed that the Bush tax cuts barely helped anyone except the wealthy. (The causes? An ideological preference for no tax cuts for anyone; a political strategy to avoid any embrace of Bush, or just plain ol' ignorance.)

This is a rank lie-- as illustrated in a recent Deloitte Tax LLP report and described by the AP's Steve Ohlemacher...

Here's some pressure for lawmakers: If they don't reach agreement on extending soon-to-expire Bush-era tax cuts, nearly all their constituents back home will get big tax increases....

Democrats have been arguing for much of the past decade that tax cuts enacted in 2001 and 2003 under former President George W. Bush provided a windfall for the wealthy. That's true, but they also reduced taxes for the working poor, the middle class and just about everyone in between...

-- Income tax rates were reduced, to a bottom rate of 10 percent and a top marginal rate of 35 percent. If the cuts expire, the bottom rate would increase to 15 percent, the top rate would rise to 39.6 percent, and several rates in between would increase as well.

-- The child tax credit was increased from $500 per child to $1,000 per child.

-- Marriage penalty relief. The standard deduction for married couples was increased, easing the tax hit on many married couples....

-- The Alternative Minimum Tax is adjusted each year to spare more than 30 million middle-income families from a tax increases averaging $3,700. The tax was enacted in 1969 to make sure wealthy people couldn't avoid taxes altogether, but it wasn't indexed for inflation.

Those tax cuts expire at the end of the year, setting the stage for a high-stakes debate just before congressional elections in November. If Congress fails to act, families at every income level will see more taxes being withheld from their paychecks come January....

Filing Status (Household income): Tax increase if cuts expire

Single, no children ($50,000): $1,100
Married, 2 children ($50,000): $2,900
Single, no children ($100,000): $2,100
Married, 2 children ($100,000): $4,500
Single, no children ($325,000): $6,600
Married, 2 children ($325,000): $7,400
Single, no children ($1,000,000): $48,500
Married, 2 children ($1,000,000): $53,200
Single, no children ($5,000,000): $271,700
Married, 2 children ($5,000,000): $276,400

2 Comments:

At September 19, 2010 at 1:08 PM , Blogger William Lang said...

I'm hoping my pay increase this year at IU Southeast will cover my increased tax bill. But I will be glad to do my part to reduce our insanely high budget deficits and national debt.

 
At September 19, 2010 at 9:51 PM , Blogger Jenna said...

Nice that you get a raise this year, William, and also that you don't mind paying "your part", but I do have to point out that as criminal as this tax increase would be, it still won't be nearly enough.
Last time I checked, our debt including unfunded liabilites, is over 100 trillion. Please, anyone, correct me if I am wrong. This means that what they really must do to get the debt under control is to SLASH the budget, like... in half.
This will NEVER happen in the real world. So my advice -- get ready for the inevitable implosion.

 

Post a Comment

Subscribe to Post Comments [Atom]

<< Home