Skip to comments.Crunching the numbers of the 2013 tax increases (It's official - the rich now pay their fair share)
Posted on 01/13/2013 1:42:07 PM PST by Libloather
WASHINGTON - The prospect of the American economy careening off a cliff overshadowed a tax increase that takes effect immediately, rich or not.
Even with the deal on Capitol Hill, the so-called payroll tax is scheduled to bounce back up to 6.2 percent from 4.2 percent in 2011 and 2012.
In practical terms, this amounts to a $1,000 tax increase for someone earning $50,000 a year and a $2,200 tax increase for someone earning $150,000.
Even workers taking home less than $20,000 annually will be impacted, paying roughly $100 more.
"I think it will have a negative effect," says Neil Buchanan, a law and economics professor at George Washington University.
(Excerpt) Read more at wtop.com ...
Every working American just got a 32% increase in their Social Security taxes.
Left out part employer pays. Will translate to layoffs to compensate.
So, there Democrat trough pigs ~ squeal!!!
Well, the liberal view is that the Social Security tax increase isn’t really an increase. In their view, the temporary reduction in those taxes expired, and now the tax rate simply went back to where it was. In liberal speak, that is not a tax increase.
Actually I am pretty sure the employer paid SS did not change when this "tax holiday" was created.
They changed only the employee paid part.
The employee pays the whole tab...unless he has a lockbox.
Corporations don’t pay taxes. People do.
You got that right. Corporations just collect the tax and pass it on to the government. The end consumer pays all taxes, either as direct tax or higher prices or inflation.
Payroll tax deflection from:
the price pressures upward due to more cliff government paychecks in circulation: 1. Essentials prices rise and 2. the sales taxes (city, state, etc.,)on everything increase, 3. As less buying due to high prices increase unemployment.
Listen you capitalist pig dog, you need to understand in that puny commerce related brain that the rich need to pay for ALL the other years they WERE NOT paying their fair share and by this it means they have to pay for all rich people from last AT LEAST 7,000 years.
They still have so much to PAY for because we won;t be happy until they have no money and even then they should pay with their lives....
Hail Mao, Stalin and Pol Pot.....
(Frothing Leftie Mode Off)
Some small businesses create fake employees. That way the owners can pull some of their income out of the business activity at a far lower tax rate. I’m thinking of writing an illustrated handbook showing folks how that is done ~ should be a best seller.
And rightly so, it was only the employee "contribution" that had the tax-holiday that was allowed to sunset. Employers were still paying 6.2% of employee wages up to the cutoff (a bit over $101K, I think). There it no increase in employer costs to trigger layoffs in that part of the deal -- the only place there would be is in raising rates on folks making $450K per year for small businesses that still file as individuals and have that large an income after deductions, and in the curtailment of deductions if it affects business-expense deductions. (Which is not to say there may well not be lots of layoffs due to Obama policies, just that they will be due to the costs of Obamacare and over-regulation, not the "fiscal cliff" deal.)
Obviously you’ve covered the additional costs associated with each employee: workmen’s comp, unemployment insurance contribution, mandatory healthcare, etc..
But, wouldn’t the company Christmas party be a lonely event? Talk about the ultimate example of pleasuring yourself!
They were in the process of renting a new 10X larger warehouse in Pittsburgh to store the bonds until they could process the change of addresses.
The small business guys creating fake employees had gotten greedy all at once and decided to BUY A BOND A MONTH! This may have occurred as a consequence of heightened awareness of illegal aliens holding regular jobs. The bond trick would, presumably, make these employees seem all that much more American.
Totally weird. They were all mailed DO NOT FORWARD, so when they put in a forwarding order for the fake employee at the relative or friend's address that they'd used, it went back to Treasury Department.
Tens of thousands of tax evaders were soon hoist!
No, I didn't invent the scam, but i certainly did some in depth research into how this one was done ~ just bet it's worse now! Time for ME to cash in with a handbook that tells you how to do it and EVADE detection!
Employers didn’t get the 2% break. They’re just evil capitalists anyway.
Now, obamakkkare requires you to figure out your medical costs as your first dollar of expenditure.
We should see a massive increase in bankruptcies and business failures in the first 6 months of next year if this legislative package stays in place.
Obama will have literally destroyed the black middle class ~ among others ~ and ignited a wave of suicides for financial reasons that should shake the foundations of the republic.
And that puke wonders why we need more guns.
What you are saying makes zero sense. It is far cheaper to pay dividends than to make up a fake employee and pay the burden. Then you say they were buying bonds? What kind of bonds? How would any of that shelter income?
Something is clearly missing from your description.
That's money your employer would be paying you, but gives it to the government instead. It's still your money. The full 100% of social security taxes is coming from you. It is all part of your total income - your employer's cost of keeping you employed.
When your employer on paper pays you $10/hr, they are really paying $10.62/hr (not including other payroll taxes, unemployment insurance, etc.) Their cost to employ you is $10.62/hr. But instead of giving you all that money, they give some of it to the government instead on your behalf. So yes, you are really paying the entire 12.4% instead of only 6.2%. For the $10.62/hr that your employer allocates for your labor, $1.24 goes to the government which will end up in the general fund. Your employer takes no hit here.
A fake employee making minimum wage might even qualify for EITC ~
There are people who are not incorporated who hire employees ~ your friendly neighborhood bodega for example ~ he'll have half a dozen part timers through the week, and it's probably quite easy for him to create another employee who earns tax free income ~ which he figures out how to keep for himself.
People deep into the multiple identification world have a leg up on this stuff. Create a fake doctor to refer you to workman's comp for your whatever.... can be done. is done, but that's a different piece of business.
Regarding US savings bonds, we thought (and this is official united states gub’mnt type thinking) they were having their fake hispanic surnamed employees buy us savings bonds so they’d seem patriotic ~ to throw the T-men off their trail.
Ludicrous. You’re right, though, it sounds like a theory a government employee might develop.
Jim - even those making over the FICA cap will see their taxes increased on that amount of income.
Nothing you are saying makes sense. Yes, of course I meant to pay dividends to yourself—as shareholder, that is how you receive profits.
Every bond had to be checked for a forwarding order and then reissued ~ that sort of thing costs money when you do it by the millions of units!
My general understanding is that the Bush tax cuts are being extended for those making less than $400,000/$450,000, but income tax rates increase for those making more.
But the FICA tax is going up for everyone (up to the FICA limit).
I doubt the average (working) Obama voter even knew that his FICA tax was going to go up. Lots of grumbling going on about decreased net earnings on their pay checks. Obama didn’t save them (unless they qualify for a free ObamaPhone, extended unemployment, food stamps, section 8 housing, etc., but then they’re probably not working).
Actually the fraud works the other way. The illegal aliens who are hired with fake SSANs have their FICA withheld and that money does actually buy bonds (meaning the political hacks "borrow" it and issue "bonds" to the SS Trust Fund).
The rub is the illegal never receives Social Security Retirement or Disability benefits because if they apply they get caught and are informed that they don't qualify.
They are unwittingly helping to perpetuate the SS Ponzi Scheme.
While the cut in FICA was cutting granny off at the knees, the Bolshies promised that the rich would make it right. The double taxation is that the price of goods will go up. The DumBO voter will have his FICA returned to normal (as a SS recipient, I thank you), and, he will have to pay more for his 16oz. drink (for which, I don’t thank you).
The question now remains, when will everyone else pay their fair share? (Except me, I’m on a fixed income.)
I would forego SS, if the Bolshecrats, had not destroyed the private sector in the name of giving me more. The solution is in sharing the wealth, not redistributing it. Protecting a vibrant private sector grows the economy more than a moribund society without reward.
No Bills, Notes or Bonds are being printed anymore, they are all issued by wire book entry.
In fact starting in March, ALL Social Security recipients will have no more "checks" only direct deposits into their banks.
Come to think about it, how many trees would it take to make enough paper to print over $3.5 Trillion per year, 50 Million Social Security Checks per Month.
Oh and are we sure we might get a tax refund "check"? They've already announced that they will be "late" due to the reprogramming that's necessary due to the cliff deal.
Don't be surprised if you get a note in the mail from the Treasury asking for your banking info so they can "wire" the refund to you... or will it be an email?
obviously a FAKE employee’s employer is going to withhold FICA and keep it ~ and anything else he can ~ and never pay it, but the records will look really good. The employer takes a risk when he files income taxes and claims all those deductions, and EITC, and then gets really greedy and says “I need to cash those savings bonds’ ~
As usual the Englishs peaking native population will need to obey the law ~ everybody else gets an exception. The auditors look right on past those guys.
That was first class postage on each and every envelope and essentially third class mail treatment ~ but they got there on time.
Those were very profitable trips. That's all gone, still, there are sufficient schemes that circumvent digital systems that it's overdue for a new handbook on how to create a fake employee so you can lower your effective tax rate.
I'm sure Treasury has tapped into this thread already ~ they should be very afraid.
People earning more than the limit also received a tax increase on all their earnings below the limit. If the limit is $113,700 their tax went from $4775 to $7049.
But keeping the Bush tax rates unchanged was a “middle class tax cut”. Funny how that works.
Luckily (for them), most of the congress critters, the ruling class, and the higher paid bureaucrats and government workers, etc, will barely be touched by any these increases.
This was a temporary reduction in the traditional FICA tax rate!
These people are idiots but we all knew that!
The real tax increase comes from obastard care and the upper income bracket increase.
The “Rich” can never pay their fair share, because the Left never defines what they mean by “fair share”, and they never define what they mean by “rich”. It’s a constantly shifting goal post.
But really if you boil it down, “rich” means “anyone with more than me”, and “fair share” means “more”.
Sorry,Problem is The Boss Obama says it is Not over,just the Beginning
I have a solution: terminate Social Security. Social Security is one of our largest entitlement programs and it WILL bankrupt America if it’s not phased out.
Congress critters do pay SS, etc. just like everybody else ~ been that way since 1987.
Congress critters do pay SS, etc. just like everybody else ~ been that way since 1987.