Government

Some Americans want to retain every government program on the books. No cutting anything. Others want to expand those programs and add more. No limits on spending.


And they want somebody, anybody else, to pay for it all.

but who is that and how much more should they pay?

Nobody is being honest about our current liabilities, our debt, our deficit or the current structure of the tax system. Nobody is telling the truth about the state of Social Security or Medicare or the long-term prospects for Obamacare. Our debt will grow by another $11 trillion over the next ten years not counting any impact of tax reform.

The Internal Revenue Service has recently released new data on individual income taxes for calendar year 2014, showing the number of taxpayers, adjusted gross income, and income tax shares by income percentages.

The data demonstrates that the U.S. individual income tax continues to be progressive, with taxes borne mainly by the highest income earners. How much more progressive do we want to be? How much more do we want to spend that we don’t pay for?

🤑 In 2014, 139.6 million taxpayers reported earning $9.71 trillion in adjusted gross income and paid $1.37 trillion in individual income taxes.

🤑 The share of income earned by the top 1 percent of taxpayers rose to 20.6 percent in 2014. Their share of federal individual income taxes also rose, to 39.5 percent.

🤑 In 2014, the top 50 percent of all taxpayers paid 97.3 percent of all individual income taxes while the bottom 50 percent paid the remaining 2.7 percent. 🤑 The top 1 percent paid a greater share of individual income taxes (39.5 percent) than the bottom 90 percent combined (29.1 percent).

🤑 The top 1 percent of taxpayers paid a 27.1 percent individual income tax rate, which is more than seven times higher than taxpayers in the bottom 50 percent (3.5 percent).

Source: Tax Foundation February 2017

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2 replies »

  1. Why not have a simple flat tax, with a standard deduction of $50,000.00, so if you make that or less you pay nothing? Assuming you earn more, you pay a simple flat rate of 15%. No loopholes and all deductions scrapped, preserving only the deductions for home mortgage interest, educational expenses, if you have a job that pays for you to go to college and charitable donations. Otherwise, everything else goes.

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  2. There is another issue resulting in being so heavily dependent on “the 1%” to pay all the taxes. As I was reading today about how the new federal budget is going to affect New Jersey, I came across a NYT article from April 2016. In March 2016, it was reported to a NJ Senate committee by New Jersey’s legislative budget and finance officer that the state’s wealthiest resident moved out of state and it affected the state’s budget due to loss of his personal income tax revenue. This man saved millions in taxes by moving to Florida.

    Think about that. Taxes from one individual can affect the state budget. That might have also resulted in all the 2% people moving up to the 1% and forcing them into the same decision.

    If “the 1%” must support all our government spending, before long you will have bidding wars like the one currently is going on for Amazon HQ2 just to keep some of this tax revenue. The government will have to start making sweetheart deals to save their budgets.

    Maybe that is why during the summer of 2017, the NJ state senate cut some taxes that favored the rich.

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