ZOT! The 400 Richest Americans Pay An 18% Tax Rate

Forbes ^

[moshiach]

The 400 richest Americans used to pay 30% of their income on the average to Uncle Sam. Today, they pay 18% on the average.

The main reason for the drop in their tax rate of some 40% is the tax cuts by George Bush in 2003, taking the rate paid on dividends and capital gains down to 15%.

[WOBBLY BOB]

The Bush Tax Cuts and the Deficit Myth —

Runaway government spending, not declining tax revenues, is the reason the U.S. faces dramatic budget shortfalls for years to come.

With Washington set to tax $33 trillion and spend $46 trillion over the next decade, how does one determine which policies “caused” the $13 trillion deficit? Mr. Obama could have just as easily singled out Social Security ($9.2 trillion over 10 years), antipoverty programs ($7 trillion), other Medicare spending ($5.4 trillion), net interest on the debt ($6.1 trillion), or nondefense discretionary spending ($7.5 trillion).

There’s no legitimate reason to single out the $4.7 trillion in tax cuts, war funding and the Medicare drug entitlement. A better methodology would focus on which programs are expanding and pushing the next decade’s deficit up.

Entitlements and other obligations are driving the deficits. Specifically, Social Security, Medicare, Medicaid and net interest costs are projected to rise by 5.4% of GDP between 2008 and 2020. The Bush tax cuts are a convenient scapegoat for past and future budget woes. But it is the dramatic upward arc of federal spending that is the root of the problem.

http://online.wsj.com/article/SB10001424052748704738404575347302831199046.html?mod=WSJ_Opinion_LEADTop

allowing President Bush’s tax cuts to retire, would be increasing the bottom rate from 10% to 15% and the 20% bracket to 25%.

Do the math :

Raising the 10% bracket to 15% represents what percentage of increase? Hint: The correct answer is NOT 5%.

Raising the 20% bracket to 25% represents what percentage of increase? Hint: The correct answer, again, is NOT 5%.

Finally, raising the 35% bracket to 39% represents what percentage of increase: Hint: The correct answer is NOT 4%.

Extra credit question: People in which tax bracket will see the largest percentage of increase in their taxes?

Extra extra credit question: People in which tax bracket will see the smallest percentage of increase in their taxes?

To those moving from the 35% to the 39% tax bracket...that’s roughly an 11% increase in taxes.

From 20% to 25%...that’s a full-blown 25% increase in taxes.

To those moving from the 10% bracket to 15%, their taxes will be increased by a whopping 50%.

So the low-income people get their taxes raised even more when seen as a percentage. And the rich folks lose a higher magnitude of money...but the percentage compared to what they already make is lower.

[harpu]

Hey dummy, you must have taken a wrong turn. Your groupies are back over there to the LEFT!

[Lazlo in PA]

How about a reply or two to some of these remarks Mosh? I guess you are to busy giggling over at DU about your post here.

[Huck]

Yeah, well I pay cap gains and dividend taxes too, and I am not rich!

[Texan]

Maybe other people do it differently, but the money I RISK by investing in equities has already been taxed ONCE (when I made it.)

Then, if I'm fortunate and those equities appreciate, I'm taxed AGAIN when it's withdrawn as dividends or capital gains.

[cherry]

I could never understand why the simple interest paid at a bank is fully taxed yet money from dividends and capital gains is given a break......

[DCBryan1]

I fall into the category of "not paying my fair share of taxes".

1) I had so many losses in 2008 and 2009 that I carried them forward.

2) Buying municipal bonds principly in 2010 and 2011 have me making TAX FREE INCOME.

STFU "annointed one", DU Troll.

[mnehring]

The latter encourages investment and growth. It is like planting seeds versus storing them.

[freedomfiter2]

50% pay NOTHING, so that means that other 50% are paying for everything.

It is false to say that anyone pays nothing. Up until there was a federal income tax, no one payed anything. I guess that our nation was founded by a bunch of deadbeats. The point is, that all taxes are taxes and it’s dishonest to only include one type of taxto make any point. How many years have you gone without paying inheritance taxes? You rarely pay inheritance taxes? How unamerican.

[MEGoody]

For those who do not work for a living (but own the majority of the U.S. wealth) they pay 10% of the bills.

Where is a list of these people? I'd like to see who they are for myself.

[Vendome]

IBTZ

Jerkoff...

[avacado]

"This reduction in the investment class’s taxes powered the bull market in stocks from the fall of 2003 until the fall of 2007."

This is a bad thing? Looks good to me!!!

[ArrogantBustard]

So ... 400 people pay 10% of the bills?

And what? You want those 400 people to pay even more?

Are ye daft, mon???

Who's your hero, Josef Stalin or Mao Tse Tung?

[Age of Reason]

The tax on money people make by the sweat of their brow should not be taxed at a higher rate than the tax on capital gains.

It should be the other way around.

Maybe if we spread the wealth around a little bit by taxing the rich more (and $250K a year is not rich), the people who don’t make enough to pay taxes now, will make enough to pay taxes then.

[Mad Dawgg]

"keep hearing that 40 to 50% of Americans pay no tax’s at all. Where are all of these people?"

Its really sort of a misnomer. Anyone who has a job pays income tax. (we aren't talking about contract labor and such) A Job is defined wherein you work for someone and fill out the IRS forms that deal with deductions. It means your employer takes out x number of dollars based on a formula etc.

So anyone with that type of a job pays income tax, but the government has fixed it so by way of the EIC (earned Income Tax Credit I believe its called) and other such things Folks below a certain income level actually get more refund back than they pay out in deductions.

Then of course you have the welfare class added into the mix. Another shocking issue is that you can make a fairly good income and still qualify for assistance from the government. Free or Reduced school lunch is one such program'

[buccaneer81]

IBTZ.

[Opinionated Blowhard]

This isn’t an article, its a tweet. Its filled with misinformation. Even on its face its wrong. The capital gain tax rate was never 30%. It has never in modern times equaled the ordinary income rate. This “article” is not news or a fact. Its propaganda.

[freedomfiter2]

The 40 to 50% who don’t pay anything are what is killing America. Not the Millionairs and Billionairs.

I have to disagree with you on that one. Most of the billionaires are far left marxists who fund organizations which are dedicated to destroying America. Many others use government to fleece real Americans.

[MeganC]

You joined on July 11th and you’re not even here a month and looking for a zot? In some respects, that’s impressive.

[mmanager]

IBTZ!!!!!