Taxes: A Question for Kerry Supporters

[sam h]

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Ten minutes later he was talking about repealling the Bush tax cut which was implemented to help the middle class.

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He did not say this. Kerry's is position is pretty unequivocal: he's saying (over and over again) that he will not raise taxes on anybody but those making over 200K.

[MMMMMM]

I really think 200K is upper-middle class, not upper class, and I certainly don't make anywhere near that much. Even if I did I would still not be living in a mansion, still have to do a lot of working and planning for retirement, still not be able to take plenty of expensive vacations, etc...and hey, I'm single!

A family with 2-3 kids making 200K can cover expenses, have decent medical insurance, and put away some money to help towards the kids' college costs, and live in a fairly nice neighborhood, but they aren't anywhere near being rich (rich is a measure of net worth).

Calling 200K "upper-class" seems inappropriate to me--"upper-middle", OK. If you earn 200K you are still a working stiff, and you will be a working stiff for many years, although you get nicer amenities than most.

It is certainly most disingenuous of politicians to call 200K income families "rich". Calling them "upper-class" is more excusable although I don't really agree with it. To be rich takes a lot more net worth than what a 200K income can accumulate except in the very long-term.

[sam h]

I know what you're saying MMMMMMM and I agree in part. But it basically just comes down to whether you want to analyze it as a question of what lifestyle you can have at X income or to look at it as a question of how your income compares to others.

If upper-class means you can live very well and don't have to worry about money, then 200K is not upper class.

But if upper-class is more of a comparative measure, then I think that if you make more than 97% of other households, you're probably in the upper class.

Personally, I tend to believe in the latter, since the concept of class stratification is sort of meaningless unless it is based on comparative, rather than absolute, criteria.

[texaspimp]

First, thanks for all of the replies to my post. As most of the respones apply to my choice of business type and/or my income, I would like to respond.

Elwood posted:
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As a small business owner who chose the structure of his business, you have made a decision that your business income = your personal income. You didn't have to make that choice. It's kind of disingenuous to now claim, "but wait, it isn't really my personal income..." If you don't want your business income to count as personal income, change the structure of your business.

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What is disingenuous is to make a false claim sir. Where did I state or imply that I was trying to hide my personal income? Do you honestly believe I was not aware of what was or was not my personal income and how I would be taxed? I made the choice to become an S-Corp specifically to be taxed once, at the personal level. Not twice, at personal and corporate levels. If you are ever in business for yourself, I would highly recommend an S-Corp or LLC (please consult your tax advisor. Poster is not a licensed financial planner)<--- Legal requirements!

Daliman posted:
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Ok, let's say you make 300k a year in profit at your company, a good chunk of change. Now, under Kerry, that will equal $3,800 more in taxes, which you were paying before anyways. Did you hire MORE people or cut prices when Bush lowered your taxes? Cut prices;hell no. Hire more people? Doubtful, since his cuts couldnt have saved you enough to hire much more than extremely part-time positions unless you make WELL over 200K, which means you shouldn't be bitching anyways.


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Your prognostication skills are amazing! Unfortunately they are incorrect. When I am able to lower prices, I do so. When I am able to make capital improvements in my business or hire more people, I do so. While a savings of $3000 to $5000 may not be much to you, it is very important to me. That allows me to purchase a new design program and/or computer equipment. Perhaps I can advertise more often or in different media. Either way, when your livlihood is on the line, I let you decide how to run my business.

Daliman goes on to post:
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What this all comes out as is, "Well, i make 500k a year, so if Kerry is re-elected, i'll pay an additional $11,600 in taxes that I was paying 2 years ago anyways. To make up for my shortfall in income, I will fire one of my single-mother employees who works 40 hours a week making $6.00 an hour. God bless America"

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As for the single mother making $12,480, if my expenses go up $11,600, yes, she might have to go. A sidenote: Why is it always a single mother?? For effect??? Back to topic. When did profit become a dirty word in America? Does it anger you that I make more than you? Does it also anger you that I spend more than you, especially on medical bills and perhaps to charity? Is the answer to get rid of all evil corporations and businesses? If that is the answer, I hope some of you have an entrepreneurial spirit (and a better business sense).

What is un-American sir, is the venom spewed by some people on these forums. Why is it a crime to make as much money as you can? Is it jealousy? I do not begrudge anyone from making as much money as they possibly can, legally. The last statement may have to be edited since we are on a poker forum! What is American is that we band together. I hope that each of you, those who agree and disagree with me, lead prosperous and happy lives.

Daliman also posts:
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And I don't even want to get STARTED on all the income lost by reservists who are among those in the guard ijacked into this BS war. I know 2 of them myself who are small business owners, one whose business failed since his deployment, and another whose business is struggling. Great job, GWB.

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I sincerely appreciate the sacrifice of your reservist friends. I hope Elwood feels the same, since they made the decision to join in the first place.

Good luck in the future!

[Chris Alger]

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the Bush tax cut which was implemented to help the middle class

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Now that's an odd way of putting it. What the tax cut was intended or supposed "to" do isn't important. Either it helped the middle class (whatever that is) or it didn't. If so, the help was either direct or indirect. Moreover, the only rational definition of "help" equates to "net gain," rather than a borrowing that the middle class will have to pay with interest.

So just what are you talking about?

[PITTM]

im pretty sure it would be 200k, since that is exactly what he said. i wouldnt consider a family making 250k/yr to be middle class.

rj

[Cashcow]

Maybe they shouldn't have joined the reserves. Is thier Country more important, or thier buisness? I think they made thier choice and I respect them for it, and thank them for it.
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so if Kerry is re-elected

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That's my favorite part.

I'm not trying to belittle your opinion, but I am trying to make a point.
The decisions we make can't all, always be perfect, or even the best.
People on this forum seem to all be one sided, and not think that, "hey, maybe that guy had a good point"
Seems to be a lot of closed minded people here.

Daliman, I apologize for using your post to respond to when it is a generalized response.

[elwoodblues]

I'm not suggesting you were trying to hide your personal income. What I am saying is that if you choose to define your personal income in such a way that you have a personal income that is not representative of how many define personal income (i.e. much of your personal income is actually income of your corporation) then you should live with the consequences of having such an inflated personal income.

By taking on the extra income from the corporation as personal, you have made a decision that it is better for you to personally be defined as someone with greater personal income. Now, when a decision might be made that affects those with greater personal income, you say (in effect) "wait, I really don't have that much personal income, it's really business income." To that, I say that's the bed you chose to lie in. It is your personal income regardless of how you derive it. The argument that you aren't really in that personal income bracket is disingenuous because you made a conscious choice to put yourself in that personal income bracket. You decided that it was better to have personal income in the upper 5%.

[adios]

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The boundaries are subjective. But since in 2001 (last year I can quickly find data), the 95th percentile for households fell around 150K, it would be pretty difficult to argue that 200K was middle class.

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Wrong Sam you have to look at net worth, a household making 200K a year could be in debt enough that a increase in their taxes could have a substantial effect on their lifestyle at the margins, the change in income effects them a lot. It's bullsh*t IMO to state categorically that anyone making over a certain amount of money is upper class instead of middle class. I'm sure people are going to state that well that's their problem if someone incurs enough debt that $200K a year makes things kind of tight, fair enough. Then it's fine if I say screw the poor bastards that are too lazy to make a better life for themselves when they could. It's also fair as well if those that are paying more in taxes support candidates who will lower their tax bill and provide tax incentives that they can take advantage of. BTW wealthy individuals can afford accountants and lawyers to find every loophole possible to pay as little as possible in taxes. The bottom line for me is that Kerry is promoting class warfare.

Anyway I'm on the record as opposing any tax increase to anyone unless the government honchos that want to raise my taxes tell me the income distrubtion they say seek after taxes are paid. Until that time which I know will be a long time coming, I say cut spending if you don't have enough money coming in.

[texaspimp]

Elwood, thank you for your non-combative response. I have to admit that I am still perplexed by your arguments. I still do not believe that I argued that I was not or did not want to be in a personal income tax bracket. Whether some people would like to admit it or not, it is intellectually dishonest to think that increasing expenses for companies will not have any detrimental effect on the economy or on jobs. I still submit that one only need to look at the tax structure in the late 70's and early 80's to find an example of how increased or high taxes stifle jobs.

As for the decision to be in the upper 5%, how many folks would turn down the money? If I offered you a job making $250,000 a year that was legal and did not negatively impact your family life, would you turn it down?

I still go back to the other part of my original post. If Kerry keeps his promise to only increase the tax on people making over $200,000, where is the money from the healthcare "federal fund" going to come from? Isn't any one else concerned about this?

Again, thank you for your civil debate.

Good luck in the future!