Posted on 09/27/2012 4:01:43 AM PDT by Kaslin
If "journalism malpractice" were a crime, Nancy Grace would not be able to keep track of all the trials.
ABC news reporter Jonathan Karl recently said: "Mitt Romney ... made $13.7 million last year and paid nearly $2 million in taxes. His effective tax rate -- 14.1 percent. That's a lower rate than an auto mechanic who made $75,000 in pay."
Not again.
Back in January, anchor Diane Sawyer teased "Mitt's millions" on ABC's "World News": "What Mitt Romney's taxes really show about wealth, taxes and fairness." Then correspondent David Muir informed viewers: "(Romney's) tax rate? In 2010, about 13.9 percent, perfectly legal under the current tax code, which allows Americans to pay a much lower rate, a capital gains tax, when their earnings come from investments, and not a job." Muir cut to a "tax analyst," who said: "If (Romney) were a doctor or lawyer with the same salary, he would be paying 35 percent (emphasis added)."
It gets worse.
NBC, through MSNBC, employs "civil rights activist" the Rev. Al Sharpton as a talk show host. He regularly rails against Romney and his fellow racist Republicans while supporting the President who wants to raise taxes on the "millionaires and billionaires" who "can afford to pay a little bit more." Sharpton is rich. But he has trouble with the "pay a little bit more" part. According to a recent profile in GQ, Sharpton lives large, in a ritzy Manhattan "bachelor pad." He belongs to an exclusive private club where -- after a television performance in which he rails against the top 1 percent -- he hangs with the top 1 percent.
Though he pushes for tax hikes on the wealthy and demands tax transparency for Romney, Sharpton himself has taken a respite from paying his own taxes. According to the New York Post last December, Sharpton owed $2.6 million to the IRS and almost $900,000 in state taxes. In addition, his nonprofit (in debt by $1.6 million) owed more than $880,000 in federal payroll taxes. But we digress.
NBC's Peter Alexander, on "Today," told his audience in January: "Romney appeared to be knocked off message, promising to share his returns in April and also disclosing that he pays 15 percent in income tax, like many wealthy Americans, but less than many middle class Americans (emphasis added)."
Over at taxpayer supported NPR, its "Morning Edition" co-host Renee Montagne said in January: "Yesterday, Romney did let slip a provocative tax detail. He acknowledged he's probably paying an effective tax rate of around 15 percent. And that's well below the rate that many middle-class families pay (emphasis added)."
One problem. It isn't true -- not even close.
First, as with the purchase of new car, almost nobody pays sticker price. To make Romney's "low" effective tax rate look bad, some news media irresponsibly compare his rate to that of a middle-class taxpayer's top marginal rate.
Just how misleading?
Assume Mr. Auto Mechanic is married, with two children. After offsetting income with exemptions, deductions for things like mortgage interest and assorted tax credits, Mr. Mechanic's effective federal income tax rate -- the percentage of income actually paid in taxes -- is much less than Romney's rate.
The liberal Tax Policy Center reports that 91.4 percent of individual taxpayers with adjusted gross incomes (AGI) between $50,000 and $100,000 pay less than 15 percent in taxes. And 43.9 percent of the $50,000-$100,000 AGI taxpayers pay an effective rate between 5 and 9.99 percent, while 4.6 percent of this group pay no federal income tax at all.
Many in the media forget about all those pesky deductions and credits and exemptions. Income tax brackets are marginal rates. The top marginal rate in a taxpayers' tax bracket DOES NOT apply to his entire income from dollar one.
New York Times' David Leonhardt understands this and, to his credit, explains it properly: "This disconnect between what we pay and what we think we pay is nothing less than one of the country's biggest economic problems. ... All told, most households pay less than 15 percent of their income to the federal government because of tax breaks, like the exclusion for health insurance, and because marginal rates apply to only a small part of a taxpayer's income. On the first $70,000 of a couple's taxable income, the total federal income tax rate is only 13.8 percent."
Why does Leonhardt comprehend this, while so many in his profession do not? Consider this.
Previous editions of a widely used high school textbook, "The American Pageant," by Thomas Bailey and David Kennedy, show charts on the federal deficit in historical dollars. When it came to the Ronald Reagan years, the graphic shows a rapidly increasing deficit. But as a share of the gross national product, Reagan's deficits are really much smaller than FDR's. By not showing the numbers as a share of the GNP, their charts make his deficits look outrageous. Of the textbook's depiction of the "outsized" Reagan deficit, University of Dayton history professor Larry Schweikart said, "The appearance to mislead seems intentional."
Well, ABC, NBC, NPR, is it intentional?
You sure you're on the right board?
What are you reading? I don't advocate tax increases on anyone. I support tax cuts for everyone. I called you on your attempt to argue by distortion. It is an unaccptable methodology here or anywhere else.
I favor that option which makes it absolutely irrelevant how much Mitt pays, or what he does with his money. He can give it all to his church if he wants ~ they'd probably like that! But gifts are not taxes.
Currently the system is inherently inequitable and cannot be fixed. The federal income tax system is a failed federal program ripe for abolition.
ROMNEY did NOT write the millions of pages of US TAX CODES.
EVERY person I have ever met in 65+++ years who is wealthy has the very best accountants & bookkeepers available. They don’t want any trouble with their books, because they know how long & tiresome audits can be.
The audits done of returns of wealthier persons is far more diligently done by the IRS than the audit of the mechanic.
A friend of mine just went thru a 18 month long audit of her 2 businesses.
The IRS wanted to not recognise ANY of the expenses of the secondary business & many legitimate deductions of the primary business. They did want to tax her on the income from BOTH sources, tho. Just NOT let her use the expenses getting that income!!! I don’t even want to ask her how much it cost her in legal & accounting fees. These accounting fees were on top of the normal accounting/bookkeeping she has always done. She hired a 2nd firm to review ALL of her records for the past 6 years ++. They found nothing wrong. They even found a couple of small items she could have deducted, therefore she overpaid a few years back.
She does very clean & detailed records and always has. She doesn’t discard any receipts and keeps them in an orderly fashion.
A few of us who are also involved in businesses like her secondary business wrote letters in her behalf, explaining the details of what we were doing.
Long & short of this story?
She won—beat the IRS on both businesses.
The letters some of us wrote were very informative to the IRS agent—he even complimented her on those letters & the details he never knew about such activities.
I don’t for one little second believe that Mitt Romney would not have the experience & ability of very good bookkeepers & accountants working for him.
Funny, my average rate has always been higher than what Mitt claims ~ and he made an awful lot more money than me.”””
It isn’t how much money is made-—it is the category of the money made which determines the rate.
MOST money made on INVESTMENTS has already been taxed at the company which made the income in the first place.
Therefore, the same beginning income got taxed TWICE.
There is EARNED income & PASSIVE income.
Have your local CPA explain this.
Just ignore him
Good move.
Note, if you take earned income and put it into a 401(k) plan, once you reach the appropriate age you can begin withdrawing those funds and any investment income you may have earned inside the fund, and pay taxes at the personal income tax rates.
Which means, of course, that there's investment income that's NOT eligible for the capital gains rate. Rather inequitable eh!
Frankly the Constitution says INCOME, and the courts say they can carve out income any way they wish, and use variable rates, flexibile rates, progressive rates, or no rate at all!
The federal income tax is an antiquated vehicle that's outlived its usefulness. Time to cut back government expenditures and cut back on taxes.
Starve the Beast.
The income tax is a failed federal program. Do not imagine tax lawyers, tax accountants and cpas are the only people who know something about how it works.
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