Tuesday, July 06, 2010

What You Really Need: Tax Increases!!

Berry was kind enough to post this; we'll just do a few of the lowest lights.

"In just six months, the largest tax hikes in the history of America will take effect. They will hit families and small businesses in three great waves on January 1, 2011

...Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed). The lowest rate will rise from 10 to 15 percent.

...The “marriage penalty” (narrower tax brackets for married couples) will return from the first dollar of income. The child tax credit will be cut in half from $1000 to $500 per child. The standard deduction will no longer be doubled for married couples relative to the single level. The dependent care and adoption tax credits will be cut.

...The “Medicine Cabinet Tax” Thanks to Obamacare, Americans will no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin).

...The “Special Needs Kids Tax” This provision of Obamacare imposes a cap on flexible spending accounts (FSAs) of $2500 (Currently, there is no federal government limit). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education.

And then, the grand-daddy, which hits Wisconsin the hardest, especially you folks in Milwaukee:

The AMT will ensnare over 28 million families, up from 4 million last year. According to the left-leaning Tax Policy Center, Congress’ failure to index the AMT will lead to an explosion of AMT taxpaying families—rising from 4 million last year to 28.5 million. These families will have to calculate their tax burdens twice, and pay taxes at the higher level.

Why Wisconsin, especially Milwaukee? Because the AMT does NOT allow you to deduct State and property taxes (nor use the standard deduction for family members.)

Just a reminder:

The Democrats Control Congress!



asianbadger said...

Guess I better get some more guns, too.

J. Strupp said...

Just so we're clear. You favor a continuation of the 2003 tax cuts? And just for the record, you're aware that these tax cuts have added over a trillion dollars to the national debt since they were enacted? In other words, you advocate the continuation of a massive deficit spending program because eliminating it would provide a negative stimulus to personal income, Cap Ex. and consumption? You know, it might hurt the economy moving forward?

I just want to be crystal clear about this so when I read the next blogpost about the virtues of fiscal responsibility, given our current economic situation, I can copy/paste your answers into every comment box from here on out.

The 2003 tax cuts are not deficit neutral, have never been deficit neutral and will never be deficit neutral. The austerity crowd is hypocritical to call for massive reductions in government spending and the continuation of current or lower tax rates.

That's what Republicans do.

Dad29 said...

Strupp, you're usually pretty logical.

Tax Cuts do NOT "add to the national debt."

SPENDING "adds" to the national debt, if not offset by tax revenue.

And the (D) Congress of the last 3.75 years has spent, spent, spent (aided by GWB and the current loon-in-office.)

J. Strupp said...

Actually I am pretty logic usually. After reading my last comment, it's obvious I wasn't in this case.

What I was (unsuccessfully) attempting to say was that the 2003 tax cuts REDUCED tax receipts and added to the national debt by increasing the gap between expenditures and revenues over the past 7 years. Obviously, spending went up as well.

Oh and BTW, my guess is that the tax cuts are going to be extended anyway. That would be consistant with the administrations economic policy. And it's an election year.

Dad29 said...

I thought you'd re-arrange the post.

It is perfectly fair to state that some tax increases are necessary and appropriate.

But it's even MORE appropriate to state that Fed spending has to diminish.

Eliminate Energy, Education, and EPA for starters.

tiegsj said...

At least this won't hit the middle class. I was starting to get worried.

Dad29 said...

Won't hit the "middle class" unless they have children, pay State/Local taxes (with joint Fed income of ~$85K or more), purchase aspirin with HRA/HSA dollars, or are in ANY tax bracket (all of them will go up.)

Other than that, no problem-o!

Jim said...

Eliminate Energy, Education, and EPA for starters.

How about we reduce defense spending?

J. Strupp said...


Dad29 said...

Umnnnhhh....sorry, guys, I actually sleep at night--gun under the pillow ;)

I have no problem eliminating a bunch of DoD spending. We could take troops out of Bosnia and Germany immediately, for example.

Keep them in Korea. Cut Afghanistan troops down to a bunch of SO units plus, perhaps, 10K to maintain supply lines, but be prepared to leave; we will not "establish democracy" there.

I'm inclined to keep up R&D expenditures on non-lethals AND to maintain the nukes.