BMW
X1 / X2
BMW Garage BMW Meets Register Search Today's Posts Mark Forums Read
BIMMERPOST Universal Forums Off-Topic Discussions Board Politics/Religion Abstain or Third Party Vote?

Post Reply
 
Thread Tools Search this Thread
      06-01-2016, 03:29 PM   #45
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Quote:
Originally Posted by bbbbmw View Post
My effective tax rate is 31%, IIRC. add the 15% and I'm at 46%. Almost no deductions, as the government basically eliminated them, therefore effectively raising taxes without an actual increase. Add the sales tax, prop tax, state/local, and I'm easily over 50% effective tax rate. Much less the impact of the Alternative Minimum Tax...

Tax rates used to be higher, but there were all sorts of deductions. People put their kids on their payroll, and funded school expenses, etc. You could write off your medical expenses and business expenses, and sales tax you paid - these are just examples.

All of those "loopholes" have been closed now, and they have effectively raised taxes. Like when Obamacare said the only thing you can use your HSA or flex spending account for are prescription-related expenses - prior to 2012, you could purchase over-the-counter drugs with that money, but no longer.
31% at the federal level? You make north of $500k per year? Count me as skeptical...

Edit: If that's true, then your 15% is right out the window. If we assumed that you were making 500k, your FICA tax (you and your employer) would amount to 3% of additional tax.
__________________
Present
2015 Chevrolet SS
2014 Jeep Cherokee Trailhawk V6

Last edited by other_evolved; 06-01-2016 at 04:15 PM..
Appreciate 0
      06-01-2016, 04:16 PM   #46
gonzo
Lieutenant General
gonzo's Avatar
United_States
8662
Rep
13,859
Posts

Drives: as many as possible
Join Date: Jan 2007
Location: TeXXXas

iTrader: (0)

Quote:
Originally Posted by other_evolved View Post
31% at the federal level? You make north of $500k per year? Count me as skeptical...
Software engineer I believe. Not far-fetched really.
__________________
Crazy Diamond
Appreciate 0
      06-01-2016, 04:22 PM   #47
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Quote:
Originally Posted by gonzo View Post
Software engineer I believe. Not far-fetched really.
It's not, but I'm skeptical of his calculation of his tax burden. If someone had their thumb on the pulse of their taxes with that sort of income, they would know that FICA/FUTA caps out at 117k....thus drastically reducing their effective tax burden as the income grows.
__________________
Present
2015 Chevrolet SS
2014 Jeep Cherokee Trailhawk V6
Appreciate 0
      06-01-2016, 05:32 PM   #48
bbbbmw
Major General
2387
Rep
6,083
Posts

Drives: 135i
Join Date: Nov 2012
Location: Southwest

iTrader: (0)

Quote:
Originally Posted by other_evolved
Quote:
Originally Posted by gonzo View Post
Software engineer I believe. Not far-fetched really.
It's not, but I'm skeptical of his calculation of his tax burden. If someone had their thumb on the pulse of their taxes with that sort of income, they would know that FICA/FUTA caps out at 117k....thus drastically reducing their effective tax burden as the income grows.
You're right - it caps out at $117k for the individual- so the 6.2% needs to back out of my calculation, after $117k. But I believe the employer contribution continues regardless, so the 7.5% needs to stay in - I consider that my cost, as the employer sees it as part of my compensation expense.

I wouldn't put "drastically" in italics - a 6.2% reduction isn't that drastic at all.

So at my income, the "pay your fair share" argument seems a bit hollow, as 47% of the population pays nothing. I agreed with Mitt Romney on that.
__________________
<OO (llll)(llll) OO>
Appreciate 0
      06-01-2016, 07:16 PM   #49
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Quote:
Originally Posted by bbbbmw View Post
You're right - it caps out at $117k for the individual- so the 6.2% needs to back out of my calculation, after $117k. But I believe the employer contribution continues regardless, so the 7.5% needs to stay in - I consider that my cost, as the employer sees it as part of my compensation expense.

I wouldn't put "drastically" in italics - a 6.2% reduction isn't that drastic at all.

So at my income, the "pay your fair share" argument seems a bit hollow, as 47% of the population pays nothing. I agreed with Mitt Romney on that.
The cap is 118k for both sides. A max of ~15k vs nearly 75k is drastic from a pure dollar stance, and a percentage. This is why I tend to be very skeptical when people complain about 40+% effective tax rates. I would venture to say that a decent majority of tax payers have a loose grasp on what they actually pay.

Last edited by other_evolved; 06-01-2016 at 07:51 PM..
Appreciate 0
      06-01-2016, 10:14 PM   #50
Kidscollege$
First Lieutenant
Kidscollege$'s Avatar
337
Rep
396
Posts

Drives: 2015 MW M4
Join Date: Dec 2014
Location: NE

iTrader: (0)

Garage List
2016 Toyota  [0.00]
2016 Lexus RX350  [0.00]
2015 BMW/M4  [0.00]
Quote:
Originally Posted by other_evolved
Quote:
Originally Posted by bbbbmw View Post
Regarding healthcare, charities did indeed take care of the sick who couldn't pay. That's why some of the largest networks of hospitals and doctors are run by churches even today - they were established to help the poor. When the government stepped in, they still covered anyone who couldn't pay. Most still have sliding scale payment calculations, but they have to be careful not to cross regulation for governmental programs.

Regarding over half of ones income being forcibly taken by governments:

- 25% federal tax rate
- 6% state tax rate
- 15% FICA, SSI, etc. (consider both sides, as employers are forced to pay it for employees)
- 8% sales tax
- property and local taxes - maybe 5%
- a zillion other taxes, like vehicle registration, Obamacare taxes, obamaphone taxes, etc.

It's easy to see how 50%+ isn't a stretch.
Eh....I'm in the 25% bracket, and I pay an effective rate of 13%. My state rate is 6, and I pay effectively 4. I would be shocked if someone actually pays HALF of their income to taxes.

The fact of the matter is we are not in an uber high tax environment from a historical sense. We have always had sales taxes, we've always had property taxes, etc., etc.



Edit: If a person is in the higher income range, their FICA/SSI/etc. is going to be drastically lower than 15%. Those taxes are an income ceiling.
I am not surprised at 50%

35% bracket, effective rate of 28%
5 % state
Approx 2% effective SS tax
AMT since you didn't get screwed enough already
7% sales tax on what ever you spend
Obamacare tax 1.5%?
Property tax
Real estate tax

Sorry had a couple edits as I kept hitting the submit instead of return button
Appreciate 0
      06-02-2016, 08:23 AM   #51
David70
Colonel
United_States
841
Rep
2,020
Posts

Drives: 06 Z4M Coupe - 13 Cadillac ATS
Join Date: Apr 2012
Location: Cincinnati, OH

iTrader: (1)

Quote:
Originally Posted by bbbbmw View Post
So at my income, the "pay your fair share" argument seems a bit hollow, as 47% of the population pays nothing. I agreed with Mitt Romney on that.
The 47% was federal income taxes and somehow people have decided that this means they pay nothing.

If you are going to count sales tax (lower incomes pay a far greater percentage of their pay to sales tax as they spend most of what they bring in), property tax (yes if you pay rent at an apartment you pay property taxes), gas tax, and Social Security taxes, Medicare Tax in your calculation then you also have to put in their calculation also. The percentage not paying anything is very small.

Then a large part of the 47% not paying federal income taxes are retired, children, or students and most of this group has or will pay a lot of taxes over their lifetime.

Then if you are paying an effective rate (every tax possible in the calculation) of 50% you are probably in the upper .1% of the population or 1 out of 1000 and this group is also that has seen the most wage and net worth growth over the last 10 years (they are the ones that have done the best by actual numbers or percentage).

Also, if you are making $500k a year you invest a large portion of this and the income on it is taxed at a much lower rate and over time your income each year continues to go up but your effective rate continues to go down. Wasn't Romney's effective federal rate under 15% which hurt his chances and one of the probable reasons Trump has no interest in showing his tax returns? The idea that he can't release anything because he is being audited is only his idea, not a law.

The argument can always be made that the system isn't fair, regardless of what side you are on, but people should at least understand the facts.
__________________
2006 Z4M Coupe - Stromung exhaust, ZHP knob, stubby antenna, clutch delay delete

Last edited by David70; 06-02-2016 at 09:04 AM..
Appreciate 0
      06-02-2016, 04:30 PM   #52
bbbbmw
Major General
2387
Rep
6,083
Posts

Drives: 135i
Join Date: Nov 2012
Location: Southwest

iTrader: (0)

Quote:
Originally Posted by David70
Quote:
Originally Posted by bbbbmw View Post
So at my income, the "pay your fair share" argument seems a bit hollow, as 47% of the population pays nothing. I agreed with Mitt Romney on that.
The 47% was federal income taxes and somehow people have decided that this means they pay nothing.

If you are going to count sales tax (lower incomes pay a far greater percentage of their pay to sales tax as they spend most of what they bring in), property tax (yes if you pay rent at an apartment you pay property taxes), gas tax, and Social Security taxes, Medicare Tax in your calculation then you also have to put in their calculation also. The percentage not paying anything is very small.

Then a large part of the 47% not paying federal income taxes are retired, children, or students and most of this group has or will pay a lot of taxes over their lifetime.

Then if you are paying an effective rate (every tax possible in the calculation) of 50% you are probably in the upper .1% of the population or 1 out of 1000 and this group is also that has seen the most wage and net worth growth over the last 10 years (they are the ones that have done the best by actual numbers or percentage).

Also, if you are making $500k a year you invest a large portion of this and the income on it is taxed at a much lower rate and over time your income each year continues to go up but your effective rate continues to go down. Wasn't Romney's effective federal rate under 15% which hurt his chances and one of the probable reasons Trump has no interest in showing his tax returns? The idea that he can't release anything because he is being audited is only his idea, not a law.

The argument can always be made that the system isn't fair, regardless of what side you are on, but people should at least understand the facts.
No matter, we still have 47% that doesn't pay anything - workforce participation (and therefore tax-paying population) should be higher. That said, I agree with everything you said - you gave a much better outline than I did.
__________________
<OO (llll)(llll) OO>
Appreciate 0
      06-02-2016, 04:52 PM   #53
Kidscollege$
First Lieutenant
Kidscollege$'s Avatar
337
Rep
396
Posts

Drives: 2015 MW M4
Join Date: Dec 2014
Location: NE

iTrader: (0)

Garage List
2016 Toyota  [0.00]
2016 Lexus RX350  [0.00]
2015 BMW/M4  [0.00]
Quote:
Originally Posted by bbbbmw
Quote:
Originally Posted by David70
Quote:
Originally Posted by bbbbmw View Post
So at my income, the "pay your fair share" argument seems a bit hollow, as 47% of the population pays nothing. I agreed with Mitt Romney on that.
The 47% was federal income taxes and somehow people have decided that this means they pay nothing.

If you are going to count sales tax (lower incomes pay a far greater percentage of their pay to sales tax as they spend most of what they bring in), property tax (yes if you pay rent at an apartment you pay property taxes), gas tax, and Social Security taxes, Medicare Tax in your calculation then you also have to put in their calculation also. The percentage not paying anything is very small.

Then a large part of the 47% not paying federal income taxes are retired, children, or students and most of this group has or will pay a lot of taxes over their lifetime.

Then if you are paying an effective rate (every tax possible in the calculation) of 50% you are probably in the upper .1% of the population or 1 out of 1000 and this group is also that has seen the most wage and net worth growth over the last 10 years (they are the ones that have done the best by actual numbers or percentage).

Also, if you are making $500k a year you invest a large portion of this and the income on it is taxed at a much lower rate and over time your income each year continues to go up but your effective rate continues to go down. Wasn't Romney's effective federal rate under 15% which hurt his chances and one of the probable reasons Trump has no interest in showing his tax returns? The idea that he can't release anything because he is being audited is only his idea, not a law.

The argument can always be made that the system isn't fair, regardless of what side you are on, but people should at least understand the facts.
No matter, we still have 47% that doesn't pay anything - workforce participation (and therefore tax-paying population) should be higher. That said, I agree with everything you said - you gave a much better outline than I did.
What people don't realize is that the 1 percenter is anyone who makes approx over $435k I believe. These will be the same people in Gates, Buffet, Koch brothers category. There is a difference between having a great income and being wealthy. Wealthy you don't care if you get fired!
Appreciate 0
      06-03-2016, 12:16 AM   #54
bbbbmw
Major General
2387
Rep
6,083
Posts

Drives: 135i
Join Date: Nov 2012
Location: Southwest

iTrader: (0)

Quote:
Originally Posted by other_evolved
Quote:
Originally Posted by bbbbmw View Post
You're right - it caps out at $117k for the individual- so the 6.2% needs to back out of my calculation, after $117k. But I believe the employer contribution continues regardless, so the 7.5% needs to stay in - I consider that my cost, as the employer sees it as part of my compensation expense.

I wouldn't put "drastically" in italics - a 6.2% reduction isn't that drastic at all.

So at my income, the "pay your fair share" argument seems a bit hollow, as 47% of the population pays nothing. I agreed with Mitt Romney on that.
The cap is 118k for both sides. A max of ~15k vs nearly 75k is drastic from a pure dollar stance, and a percentage. This is why I tend to be very skeptical when people complain about 40+% effective tax rates. I would venture to say that a decent majority of tax payers have a loose grasp on what they actually pay.
I wonder how that works for employers to cap at $117k? Let's say you have four jobs in one year, and make $100k at each job. When you file your taxes, you would cap at $117k, and receive a credit/refund for the tax collected on the other $283k. But each of your employers would pay the tax on your $100k; and the government would over-collect the employer portion, as each employer would have no way of knowing what the others had paid?

Anyone here a tax accountant?
__________________
<OO (llll)(llll) OO>
Appreciate 0
      06-06-2016, 11:34 AM   #55
catcher22
Captain
282
Rep
922
Posts

Drives: 2008 335xi Coupe
Join Date: May 2008
Location: Virginia

iTrader: (2)

what the heck did this thread turn in to
Appreciate 0
      06-06-2016, 11:35 AM   #56
Kidscollege$
First Lieutenant
Kidscollege$'s Avatar
337
Rep
396
Posts

Drives: 2015 MW M4
Join Date: Dec 2014
Location: NE

iTrader: (0)

Garage List
2016 Toyota  [0.00]
2016 Lexus RX350  [0.00]
2015 BMW/M4  [0.00]
Quote:
Originally Posted by catcher22
what the heck did this thread turn in to
I think it turned into what either candidate would do to our taxes?
Appreciate 0
      06-06-2016, 11:44 AM   #57
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Quote:
Originally Posted by bbbbmw View Post
I wonder how that works for employers to cap at $117k? Let's say you have four jobs in one year, and make $100k at each job. When you file your taxes, you would cap at $117k, and receive a credit/refund for the tax collected on the other $283k. But each of your employers would pay the tax on your $100k; and the government would over-collect the employer portion, as each employer would have no way of knowing what the others had paid?

Anyone here a tax accountant?
This would seem to be an extreme outlier case. Like, 1/10th of 1% type of occurrence, if that.

I would guess that each employer would be on the hook to pay, since they are paying for their share of the income.
__________________
Present
2015 Chevrolet SS
2014 Jeep Cherokee Trailhawk V6
Appreciate 0
      06-06-2016, 04:07 PM   #58
bbbbmw
Major General
2387
Rep
6,083
Posts

Drives: 135i
Join Date: Nov 2012
Location: Southwest

iTrader: (0)

Quote:
Originally Posted by other_evolved
Quote:
Originally Posted by bbbbmw View Post
I wonder how that works for employers to cap at $117k? Let's say you have four jobs in one year, and make $100k at each job. When you file your taxes, you would cap at $117k, and receive a credit/refund for the tax collected on the other $283k. But each of your employers would pay the tax on your $100k; and the government would over-collect the employer portion, as each employer would have no way of knowing what the others had paid?

Anyone here a tax accountant?
This would seem to be an extreme outlier case. Like, 1/10th of 1% type of occurrence, if that.

I would guess that each employer would be on the hook to pay, since they are paying for their share of the income.
So then the 7.5% (employer portion) should be included in the overall tax percentage.
__________________
<OO (llll)(llll) OO>
Appreciate 0
      06-06-2016, 04:25 PM   #59
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Quote:
Originally Posted by bbbbmw View Post
So then the 7.5% (employer portion) should be included in the overall tax percentage.
I never claimed otherwise.
__________________
Present
2015 Chevrolet SS
2014 Jeep Cherokee Trailhawk V6
Appreciate 0
      06-06-2016, 04:28 PM   #60
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Actually, from some quick research it turns out that an individual should still be capped based on the 117k from the employer side. In this instance, the employee would tell the affected employers about their other incomes, and they would not over-withhold.
__________________
Present
2015 Chevrolet SS
2014 Jeep Cherokee Trailhawk V6
Appreciate 0
      06-06-2016, 04:39 PM   #61
bbbbmw
Major General
2387
Rep
6,083
Posts

Drives: 135i
Join Date: Nov 2012
Location: Southwest

iTrader: (0)

Quote:
Originally Posted by other_evolved
Quote:
Originally Posted by bbbbmw View Post
So then the 7.5% (employer portion) should be included in the overall tax percentage.
I never claimed otherwise.
Perhaps I misread what you said:

"The cap is 118k for both sides. A max of ~15k vs nearly 75k is drastic from a pure dollar stance, and a percentage..."

But apparently the cap isn't $118k (actually $117k) from the employer side? I'm just looking for clarity. I've never been asked by an employer what my wages were at another firm - which means they don't know.
__________________
<OO (llll)(llll) OO>
Appreciate 0
      06-06-2016, 04:45 PM   #62
other_evolved
Lieutenant Colonel
1583
Rep
1,688
Posts

Drives: 2015 Chevrolet SS
Join Date: Oct 2012
Location: Saint Louis

iTrader: (0)

Quote:
Originally Posted by bbbbmw View Post
Perhaps I misread what you said:

"The cap is 118k for both sides. A max of ~15k vs nearly 75k is drastic from a pure dollar stance, and a percentage..."

But apparently the cap isn't $118k (actually $117k) from the employer side? I'm just looking for clarity. I've never been asked by an employer what my wages were at another firm - which means they don't know.
See my subsequent post. It's the responsibility of the taxpayer to notify other employers....similar to filling out a W4, I imagine.
__________________
Present
2015 Chevrolet SS
2014 Jeep Cherokee Trailhawk V6
Appreciate 0
      06-06-2016, 05:55 PM   #63
Anthony235
Lieutenant Colonel
Anthony235's Avatar
United_States
690
Rep
1,545
Posts

Drives: m235i
Join Date: Feb 2016
Location: OC, Ca

iTrader: (2)

Garage List
2015 BMW  [0.00]
Quote:
Originally Posted by eflatminor View Post
I typically vote libertarian. Always have. That said, if I were in a state that wasn't pretty much sure of going toward the Democrat...ANY Democrat, then I would hold my nose and vote Republican. So yes, I would vote for Trump to stop Hillary. I know how bad she'd be; Trump is largely unknown. Not happy about either of course. No real libertarian is.
Yes, agree 100%.

I'm in Cali though. Registered Libertarians cannot vote for Republicans in the Primary.

I would usually not vote for Trump, but I honestly believe this is the most important election of my lifetime (I'm 38).

Ron Paul, I miss you.
Appreciate 0
Post Reply

Bookmarks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off



All times are GMT -5. The time now is 05:56 PM.




xbimmers
Powered by vBulletin® Version 3.8.11
Copyright ©2000 - 2020, vBulletin Solutions Inc.
1Addicts.com, BIMMERPOST.com, E90Post.com, F30Post.com, M3Post.com, ZPost.com, 5Post.com, 6Post.com, 7Post.com, XBimmers.com logo and trademark are properties of BIMMERPOST