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In 2018, for the first time in history America’s richest billionaires paid a lower effective tax rate than the working class.

NickFire

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Can someone show me a clean tax bill that Dems supported which would have reduced my taxes in the past 3 years? Until that day happens, every single article about Trump's tax law means nothing to me.

Where is 122k listed as "middle class" income? 122k is way outside of the middle class, especially for a single person.
In many parts of this country, 122k is lower middle class for a family, at best.
 

Cybrwzrd

Anime waifu panty shots are basically the same thing as paintings of the french baroque masters, if you think about it.
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In many parts of this country, 122k is lower middle class for a family, at best.
For a FAMILY. Yes. He is claiming to be paying more than 15% as middle class, and I am explaining that it is very difficult to get above 15% at a middle class income unless you are single and no longer in the middle class.

At 122k in income for a married filing jointly family with only one child and ONLY a standard deduction your tax burden drops to $11,079. Or 9% effective tax rate. To get above 15% effective you need to clear ~225k in joint income.
 
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SurprisedPikachu

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It's odd that the trend downward is roughly linear and constant - I'd like to see the actual math to know what is going on.

On a practical side, what does it matter? The taxes from those 400 families is largely insignificant.
They had to use 400 families to show a downward trend too. :messenger_tears_of_joy:
 

desertdroog

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For a FAMILY. Yes. He is claiming to be paying more than 15% as middle class, and I am explaining that it is very difficult to get above 15% at a middle class income unless you are single and no longer in the middle class.

At 122k in income for a married filing jointly family with only one child your tax burden drops to $11,079. Or 9% effective tax rate.
At $122,000k a year for a single person (high end of middle class, but still middle class), you will pay more than 15 percent, even at 100k to the limit. Why does this cause problems for you when I say I am overtaxed?
 
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Cybrwzrd

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At $122,000k a year for a single person (high end of middle class, but still middle class), you will pay more than 15 percent. Why does this cause problems for you when I say I am overtaxed?
Because 122k income for a single person is 91st percentile, it isn't middle class.

Objectively speaking - 15% effective income tax is low.

Might I add, that if you are paying the max tax at 122k, then you aren't taking any deductions for health insurance, 401k, IRA, mortgage interest, healthcare costs, etc; you qualify as an idiot for not taking advantage of tax breaks.
 
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NickFire

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For a FAMILY. Yes. He is claiming to be paying more than 15% as middle class, and I am explaining that it is very difficult to get above 15% at a middle class income unless you are single and no longer in the middle class.

At 122k in income for a married filing jointly family with only one child and ONLY a standard deduction your tax burden drops to $11,079. Or 9% effective tax rate. To get above 15% effective you need to clear ~225k in joint income.
Are you only counting federal taxes? I am not criticizing if so, but I personally count FICA, Medicare, state, local, sales, etc., all as part of the effective tax rate. And there's no way 122k pays only 9% the way I calculate it.
 

Cybrwzrd

Anime waifu panty shots are basically the same thing as paintings of the french baroque masters, if you think about it.
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Are you only counting federal taxes? I am not criticizing if so, but I personally count FICA, Medicare, state, local, sales, etc., all as part of the effective tax rate. And there's no way 122k pays only 9% the way I calculate it.
Only Federal. I said this above.
 
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Ornlu

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Then you make well above 100k/year.

Adjusted Federal Income Tax for a $100,000 salary taking a standard deduction on the single tax table in 2019 was $15,246.50. So 15.2%.

Newsflash, you aren't middle class.



SSI/Medicare are both entitlements that you are pre-paying for.

Auto insurance is a tax?
Of course it's a tax. It's required by law to have in order to drive a vehicle. My point being that if you add up everything that an average "middle class" person pays in some form of taxes, it's not a small number. It's a much bigger number than just cherry-picking a federal tax number.
 

Vicetrailia

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Why are you just comparing federal. Effective tax rate is total/total. Not federal total/total.

And sales tax isn't included in that fyi.
 
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Cybrwzrd

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Why are you just comparing federal. Effective tax rate is total/total. Not federal total/total.

And sales tax isn't included in that fyi.
Effective tax rate is average % paid on earned income.

People always complain about federal being too high.

FICA is 7.65%. It doesn't change based on income level. It also is prepayment for a benefit you will get when you qualify for it. Might as well consider a voluntary 401k contribution to be a tax then if you are going to get pedantic.

Every state has a different tax level. Like mine, 0% income tax. How can I calculate for that, and the thread is about federal taxes, not state.

Of course it's a tax. It's required by law to have in order to drive a vehicle. My point being that if you add up everything that an average "middle class" person pays in some form of taxes, it's not a small number. It's a much bigger number than just cherry-picking a federal tax number.

If you don't want to pay for auto insurance, don't buy a car? It isn't mandatory that you own a car. Also, it makes financial sense to have car insurance if you aren't wealthy enough to self insure.
 
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finowns

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It's Berkeley so I'm going to be skeptical on anything they say when it involves politics.
 
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Sejan

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I think the bigger crime here is that the bottom 50% pay an effective tax rate of 25%.
 

oagboghi2

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We are talking potatoes and gundams here.

Regardless- which is better for the economy in these two situations?

Situation 1 - you get a 1000 tax break. You take that money and buy a brand new Chinesium 4K television.

Situation 2 - you don't get a 1000 tax break, the government instead takes the money and spends it toward paying a local contractor for road repairs.
Is this before or after politicians skim off the top of that 1k. And what about the bloated union contract that is signed with a federal contractor to fix the roads. Or better yet, the money is diverted to something else completely different.

I'll stick with the money staying in my pocket, thanks
 

Cybrwzrd

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Is this before or after politicians skim off the top of that 1k. And what about the bloated union contract that is signed with a federal contractor to fix the roads. Or better yet, the money is diverted to something else completely different.

I'll stick with the money staying in my pocket, thanks
So you'd rather send 1k to China for that new TV than have the money spent locally through a government contract, which due to how the money multiplier works creates more local jobs and growth.
 

ipukespiders

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If I was a billionaire you'd be damn sure I'd have the best accountants making sure I kept as much money as possible.
Poor people need to man up and hit the gym. Wait a sec, that's short people. Anyways, fuck poor people.
 

Cybrwzrd

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If the working class was making a lot more money overall than they used to, wouldn't this also be the result?
You and I both know that the working class is making less money overall than they used to, inflation adjusted. The fact that inflation has been suppressed by the fed, is a major factor in the rise of a billionaire class and stagnation of wages for 40 years.
 

Ornlu

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You and I both know that the working class is making less money overall than they used to, inflation adjusted. The fact that inflation has been suppressed by the fed, is a major factor in the rise of a billionaire class and stagnation of wages for 40 years.
On the flip side, it's also the reason unemployment sits as low as it does. The economy is designed to be the way it is, for good or ill (or both). We operate more as a jobs creator for the masses than as a wealth creator for the masses.
 

betrayal

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You literally said "you should ask why there are only 400 rich families and 83 million working class families."

Bruv, come on.

If you can prove the bolded I would welcome that new information. I'd also be interested in what the top 400 are doing different as far as taxes and law that the next 400 aren't doing.
I suggest you use google for simple information like that. The IRS provides data for the income tax rates.

Of course there's no exact example for the 800 richest families, but it is very clear, that rich(er) people in the US pay way more taxes than the "400 rich families need to pay more taxes" articles suggest. There's only one reason to pick 400...and that's because of the numbers, because if you specifically pick 400, it even more backs up the narrative that the rich are exploiting the poor and they only suffer because of those greedy people. Why didn't they choose the top 1% (instead of the top 400) and compared them with the bottom 90%? Because the top 1% payed 37,3% vs 30,5% (bottom 90%).

In the article you've linked they compared the top 400 to the bottom 50% of US households. That botton 50% only pay 3% of total income taxes, while the top 50% pays 97% of the income taxes. But of course, don't blame the bottom 50% who pay 3%, because they do nothing wrong. It's the top 50%, or even better, the top 400, who exploit us and who are responsible for their agony.

And by the way, the bottom 50% payed 5% of all income taxes in 2001. Now they pay 2% less. It's a decrease.
The top 0.001% payed ~2.3% in 2001. Now they pay ~3,3%. It's an increase.

But hey, let's pick the top 400 and pretend it has somethng to with inequality.

And again, thanks for not talking about relevant points (aka reasons and if it is really bad news for the poor?). You just post some numbers and an article and you're not even remotely interested in a discussion. But that's not only you, it's a general problem of this site, because some people use it as their own personal blog, where they just post some "newsworthy" stuff that fits their narrowed-minded world view and are not open for an exchange of ideas and views.
 
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Vicetrailia

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I suggest you use google for simple information like that. The IRS provides data for the income tax rates.

Of course there's no exact example for the 800 richest families, but it is very clear, that rich(er) people in the US pay way more taxes than the "400 rich families need to pay more taxes" articles suggest. There's only one reason to pick 400...and that's because of the numbers, because if you specifically pick 400, it even more backs up the narrative that the rich are exploiting the poor and they only suffer because of those greedy people. Why didn't they choose the top 1% (instead of the top 400) and compared them with the bottom 90%? Because the top 1% payed 37,3% vs 30,5% (bottom 90%).

In the article you've linked they compared the top 400 to the bottom 50% of US households. That botton 50% only pay 3% of total income taxes, while the top 50% pays 97% of the income taxes. But of course, don't blame the bottom 50% who pay 3%, because they do nothing wrong. It's the top 50%, or even better, the top 400, who exploit us and who are responsible for their agony.

And by the way, the bottom 50% payed 5% of all income taxes in 2001. Now they pay 2% less. It's a decrease.
The top 0.001% payed ~2.3% in 2001. Now they pay ~3,3%. It's an increase.

But hey, let's pick the top 400 and pretend it has somethng to with inequality.

And again, thanks for not talking about relevant points (aka reasons and if it is really bad news for the poor?). You just post some numbers and an article and you're not even remotely interested in a discussion. But that's not only you, it's a general problem of this site, because some people use it as their own personal blog, where they just post some "newsworthy" stuff that fits their narrowed-minded world view and are not open for an exchange of ideas and views.
It doesn't matter if the top 1% pays 97% of the taxes. The top 1% shouldn't have a lower effective tax rate than the bottom 50%. It shows how screwed up the deductions system is. It's also messed up that they can pay accountants all this money, and donate to lobbyists to write these tax laws, and come out way ahead generation after generation.
 
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betrayal

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It doesn't matter if the top 1% pays 97% of the taxes. The top 1% shouldn't have a lower effective tax rate than the bottom 50%. It shows how screwed up the deductions system is. It's also messed up that they can pay accountants all this money, and donate to lobbyists to write these tax laws, and come out way ahead generation after generation.
In some points i agree. There are way too many backdoors people can use to decrease total paid taxes. But like i've already said previously, in many cases the rich people or corporations are a driving factor for innovation and R&D, which a things everyone can benefit from. Of course there are negative examples, but let's just take some of the richest people in the US. Bill Gates, Elon Musk, Jeff Beszos, Jim Walton, Sergey Brin and Marc Zuckerberg. You don't need to like them and there are many reasons not to do so, but they fundamentally changed the whole society and how we work, buy things, travel or interact with people. They provided solution for problems. Maybe some of these problems were problems that we never knew existed, but most of us are still influenced by these people or benefit from the things they have developed and provide. Besides all of that, their money also created ten thousands of jobs that helped people improve their (financial) lives.

Personally i don't want to say that i think it is fair how the tax systems work nowadays. But you have to be real here, too. It's not all bad, even if at first glance the numbers can look like that.
 
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Foxbat

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In some points i agree. There are way too many backdoors people can use to decrease total paid taxes. But like i've already said previously, in many cases the rich people or corporations are a driving factor for innovation and R&D, which a things everyone can benefit from. Of course there are negative examples, but let's just take some of the richest people in the US. Bill Gates, Elon Musk, Jeff Beszos, Jim Walton, Sergey Brin and Marc Zuckerberg. You don't need to like them and there are many reasons not to do so, but they fundamentally changed the whole society and how we work, buy things, travel or interact with people. They provided solution for problems. Maybe some of these problems were problems that we never knew existed, but most of us are still influenced by these people or benefit from the things they have developed and provide. Besides all of that, their money also created ten thousands of jobs that helped people improve their (financial) lives.

Personally i don't want to say that i think it is fair how the tax systems work nowadays. But you have to be real here, too. It's not all bad, even if at first glance the numbers can look like that.
I get where you're coming from, and to an extent... You're right.

There are many people who point out the same point that you just did. They, like you say "But look at all the people they employ, and the ways they've innovated," they point this out, and call it a day thinking their position spells everything out, and explains it all.

There's nothing wrong with that per say, but let's dig a little bit deeper...

All those people you mentioned are largely responsible for starting the companies that made them billions. They innovated ideas, and created solutions. However, if you look closely, you'll find that their wealth is increasing at a rate that doesn't compare to what they contribute to those companies any more. Bezo's wealth increases by tens of billions of dollars a year. While Bezos founded Amazon, he largely has little impact on it these days. Bill Gates is the same. He got immensely wealthy because he founded MS, but he hasn't made any real contribution to MS in a decade or more. He hasn't started up any new large businesses that employs thousands of people since he left MS. Although he donates quite a bit to charity, he's largely just a parking spot for a considerable amount of America's wealth. Walton and Brin are largely the same. They used to earn what they made year in and year out, but they longer do so.

The companies they founded have become beasts of their own. The thousands of people who work for Walmart, Amazon, and MS are the ones innovating for the company these days. As MS and Walmart have shown. Those companies will be successful even without their founders, or current ceo's. They are like parents living off of the children they created. While those companies pay for r&d, and still innovate, they also park mountains worth of cash in over seas accounts. And there's only so much cash to go around.

You also mentioned Elon Musk though, and Elon is a different kind of animal. Unlike the former, after getting super rich from PayPal, he didn't stick around to simply get a check. He spread the wealth by giving others a chance, and letting them take over. He then went on to create large companies such as Tesla, SpaceX, Boring, and his neural network company. He continues to personally innovate, and create. He also isn't nearly as wealthy as the others because of it.

If the really wealthy in the US all acted more or less like Musk, then the whole inequality debate would be simple. But far too many are akin to the first examples. They continually suck up more and more of the finite amount of wealth, and largely hoard it. While no longer contributing an equal amount of worth back to the economy or society as a whole.


So at first glance the numbers do appear to be bad in some aspects. If you really look at where the wealth goes, where it stays, and how it works for the economy as a whole... Things really are that bad.
 
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betrayal

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There's nothing wrong with that per say, but let's dig a little bit deeper...

All those people you mentioned are largely responsible for starting the companies that made them billions. They innovated ideas, and created solutions. However, if you look closely, you'll find that their wealth is increasing at a rate that doesn't compare to what they contribute to those companies any more. Bezo's wealth increases by tens of billions of dollars a year. While Bezos founded Amazon, he largely has little impact on it these days. Bill Gates is the same. He got immensely wealthy because he founded MS, but he hasn't made any real contribution to MS in a decade or more. He hasn't started up any new large businesses that employs thousands of people since he left MS. Although he donates quite a bit to charity, he's largely just a parking spot for a considerable amount of America's wealth. Walton and Brin are largely the same. They used to earn what they made year in and year out, but they longer do so.

The companies they founded have become beasts of their own. The thousands of people who work for Walmart, Amazon, and MS are the ones innovating for the company these days. As MS and Walmart have shown. Those companies will be successful even without their founders, or current ceo's. They are like parents living off of the children they created. While those companies pay for r&d, and still innovate, they also park mountains worth of cash in over seas accounts. And there's only so much cash to go around.

So at first glance the numbers do appear to be bad in some aspects. If you really look at where the wealth goes, where it stays, and how it works for the economy as a whole... Things really are that bad.
First off, i think we can all agree the rich should be ripped off the countless opportunities to decrease their tax load. Simultaneously you have to acknowledge, that the rich are paying way more higher taxes compared to 99% of the population.

You also have to be aware of the fact, that companies nowadays can freely choose their location around the world and benefit from the "better" tax laws in other countries. You can observe this on a daily base with corporations all around the globe. Sure, there are other factors like work force, wages etc., but the outcome could be that higher taxes doesn't necessarily mean there is suddenly more money for the goverment to spend for their people and it surely doesn't mean, that people will automatically benefit from higher taxes imposed on the rich. It could mean quite the opposite and just raising the taxes for high incomes could have disastrous consequences for everybody, even the people not affected by it.

I'm all for better and more fair tax laws, but what i find frustrating is that many people directly assume that their life sucks because rich people do not pay high enough taxes. It's the typically victim mentality. Others are responsible for my suffering. In my humble opinion this just distracts from the real reasons and of course it is beneficial for getting votes in elections, because it provides an easy solution for a more complex problem.
 
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Jonirenicus

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So you'd rather send 1k to China for that new TV than have the money spent locally through a government contract, which due to how the money multiplier works creates more local jobs and growth.
You're not "sending 1k to China" when you buy a thousand dollar TV.

The store you buy it from has marked it up from what they paid for it. The store makes a profit. If you bought it somewhere with a commission based sales system, that individual got a direct profit. That store uses its sales income to pay all its employees. Everyone who works at your local store benefits from that purchase from the person who unloaded it from the delivery vehicle to the guy who put it out on the floor (May also be the same person but that varies) and rung you out at the end of the transaction. They're people local to you who see the benefit from your purchase.

The driver who brought that TV to the store was paid by his company, who made money from the store to deliver it there. He is someone local to you.

The TV came through a local sorting location for the delivery service, staffed by people who live near you, who each were the benefactor of the continued business of that store where you spent money.

Someone further out brought that TV to the sorting center, who was paid by the company that profited from them having it shipped.


And so on and so forth.


The company that made it in China probably saw $4-500 of that thousand at most, and not as pure profit.
 

Cybrwzrd

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You're not "sending 1k to China" when you buy a thousand dollar TV.

The store you buy it from has marked it up from what they paid for it. The store makes a profit. If you bought it somewhere with a commission based sales system, that individual got a direct profit. That store uses its sales income to pay all its employees. Everyone who works at your local store benefits from that purchase from the person who unloaded it from the delivery vehicle to the guy who put it out on the floor (May also be the same person but that varies) and rung you out at the end of the transaction. They're people local to you who see the benefit from your purchase.

The driver who brought that TV to the store was paid by his company, who made money from the store to deliver it there. He is someone local to you.

The TV came through a local sorting location for the delivery service, staffed by people who live near you, who each were the benefactor of the continued business of that store where you spent money.

Someone further out brought that TV to the sorting center, who was paid by the company that profited from them having it shipped.


And so on and so forth.


The company that made it in China probably saw $4-500 of that thousand at most, and not as pure profit.

You are missing the point.
 

Cybrwzrd

Anime waifu panty shots are basically the same thing as paintings of the french baroque masters, if you think about it.
Sep 29, 2014
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If the really wealthy in the US all acted more or less like Musk, then the whole inequality debate would be simple. But far too many are akin to the first examples. They continually suck up more and more of the finite amount of wealth, and largely hoard it. While no longer contributing an equal amount of worth back to the economy or society as a whole.
That is because most of the ultra wealthy are just rentiers. Rent seeking behavior is terminal cancer in a free market system. It has to be discouraged, through wealth taxes.

You also have to be aware of the fact, that companies nowadays can freely choose their location around the world and benefit from the "better" tax laws in other countries.
Companies, like people, should be good citizens of whatever country they do business in. Treason is a capital offense. It should also work the same for corporations. Be a traitor, get your corporate charter revoked and lose access to the market.
 
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Ornlu

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That is because most of the ultra wealthy are just rentiers. Rent seeking behavior is terminal cancer in a free market system. It has to be discouraged, through wealth taxes.



Companies, like people, should be good citizens of whatever country they do business in. Treason is a capital offense. It should also work the same for corporations. Be a traitor, get your corporate charter revoked and lose access to the market.
No lies detected
 
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