I hope the readers of the blog don't think this is becoming redundant, but I cannot stand by while people live in a world of myth. People can vote for whomever they want, but I am worried that the things people believe in and use as a basis for voting can be factually wrong. To me, voting without truth is dangerous. If you're going to vote democrat or republican, that's fine. Just please know the facts about the information you care about. I hope to help people learn things. I hope to help people dispel myth and see the truth. Recently, I think the biggest thing that gets under my skin the most is this myth about middle class vs. millionaires' tax rates. See below:
Last night, I received a Tweet (this blog has a Twitter account @lmelephantblog) from someone who did not like our conservative viewpoint. I had tweeted that Mitt Romney won the Nevada Caucuses and used the hashtag @MittRomney in my tweet. He obviously monitored Romney's twitter and decided to message me. His information is blacked out, but the message is clear:
Source: http://en.wikipedia.org/wiki/Income_tax_in_the_United_States#Year_2011_income_brackets_and_tax_rates
I turned to Microsoft Excel (you know I just love Excel tables) to help with the analysis. First, allow me to establish some givens:
- I will use the most conservative estimate I can to make sure (though unrealistic) each taxpayer pays the maximum amount. This means:
- No deductions
- No write-offs
- Neither taxpayer will receive a refund of any kind
- Each taxpayer will pay the pre-payroll tax holiday tax rate of 7.65% total (6.2% for SS and 1.45% for Medicaid taxes)
The math is quite simple. Please see the results:
So what does all this mean? Well, I have concluded:
- Someone that makes $57,000 of total income pays a final effective tax rate of 25.85%
- It would take an income of $83,250 to pay a final effective tax rate of 28.00%.
- Again, these tax rates are WITHOUT deductions. Normally, people making between $57K and $83K would have children, houses, and other write-offs and deductions, making their effective tax rates even lower. I make $53k (now current salary) and my tax rate was less than 14%. See my tax information at this post: http://loudmouthelephant.blogspot.com/2012/01/part-2-what-do-mitt-romneys-tax-returns.html
- The twitter commenter was $26,250 or 46% too high.
What do YOU think? Is this analysis off? Is this the truth? All comments are appreciated.
This load of lies and halve truths again ? (Rolling eyes) Ohhhhhh Brother .
ReplyDeletePoor little millionaires. And NO I am not your dog. I don't have to go searching the internet for stupid little clips to prove what I'm saying. Not you or any other RINO trying to be the next Rush Limbaugh is going to fool me OR the American majority.
Ron Paul .....Or Obama. The rest of those Ass Clowns on the ticket just want to make the Rich Richer and STEAL from the middle class.
For Shame
So let me see if I have this straight:
Delete- We receive a Twitter note saying "someone making $57K pays 28% in taxes." - Fact (its image is pasted above)
- We decide to investigate to see if this is true, or just some mythological rant people believe. - Fact... we investigated using real, cited, IRS marginal tax bracket information.
- We conclude (to back what our position) that not only does someone making $57K not pay 28% in taxes, but that under the current U.S. tax system, it's actually impossible - Fact, check the math above.
So, since our blog is a blog that takes positions and backs them with provable, cited, repeatable facts, how in the world is this a "load of lies and halve [sic?] truths?" We took a position, we backed it. Now it's your turn. You took a position, but can you back it? How in the world is this a "load of lies." If there is one thing, to me, that is truly disgusting, regardless of if you're a democrat or republican, is chanting, ranting, protesting, taking a position, etc. that is unbacked. To march up and down the street with some sign that is not based on the fact is basically what you're doing. You claim this is a load of lies, but you don't give any examples of how that is. So yes, would you like to enlighten us with an actual, factual, evidence-based position or counter position?
I doubt it. Instead you will talk about dogs or something. You're right; you don't have to search the internet for anything. That's fine. But when you come here and make a baseless, unproven, unbacked statement, you look really ignorant, and as if you have no clue what you're talking about. I came with facts, you came with "liar, liar, pants on fire." I'm not sure what world you live in, but in the adult world, facts win.
As far as being the "next Rush Limbaugh"... no, again, nice assumption. If you add all the Rush Limbaugh radio clips and shows I've listened to back to back, you might have 1 minute and 30 seconds of total time listening to him. He is a self promoter, I'm a fact promoter.
Thanks again for bringing nothing to this conversation. I would hope now that you've been challenged, that you can actually enlighten no only me, but the hundreds of other people that might read this. You're the reason this country is so divided. We post what we post so people can learn. You post what you post so they can't. So, can back what you say, or will this be another hollow, house-of-cards attack by someone who sees fact-based analysis and knows they can't get around it any other way?
I find it funny that so many RP supporters sling the "RINO" insult, yet are willing to vote for Obama.
DeleteYou are using "RINO" as a "republican in name only" insult, as if we aren't republican enough, but yet you would vote for Obama?
= clueless, thanks but no thanks
I make high five figures, and after mortgage interest, property tax, 401k, and charity, I pay an effective federal rate of 8.9%
ReplyDeleteLilac Sunday - Thank you for your post. If I read you correctly, you make between $0 - $99,999 and pay an effective, after refund rate of 8.9%?
DeleteYour info falls in line with the bar graph shown here: http://loudmouthelephant.blogspot.com/2012/01/stopping-lefts-propaganda-with-truth.html
Thank you for the info. As you can see, we are about spreading truth in the face of constant house of card lies.
I fart in your general direction
ReplyDeleteThanks for the comment...
Delete# constant house of card lies
ReplyDeleteTagged your Bullshit site :) Have a nice day !
Can you point out the lies? I can't find any.
DeleteIf anything, the post was biased in favor of the person who made the original claim of $57K paying 28%. And even with that bias, you couldn't get there.
For the people that keep calling this "lies" I paste the original response by LME:
Delete"So let me see if I have this straight:
- We receive a Twitter note saying "someone making $57K pays 28% in taxes." - Fact (its image is pasted above)
- We decide to investigate to see if this is true, or just some mythological rant people believe. - Fact... we investigated using real, cited, IRS marginal tax bracket information.
- We conclude (to back what our position) that not only does someone making $57K not pay 28% in taxes, but that under the current U.S. tax system, it's actually impossible - Fact, check the math above.
So, since our blog is a blog that takes positions and backs them with provable, cited, repeatable facts, how in the world is this a "load of lies and halve [sic?] truths?" We took a position, we backed it. Now it's your turn. You took a position, but can you back it? How in the world is this a "load of lies." If there is one thing, to me, that is truly disgusting, regardless of if you're a democrat or republican, is chanting, ranting, protesting, taking a position, etc. that is unbacked. To march up and down the street with some sign that is not based on the fact is basically what you're doing. You claim this is a load of lies, but you don't give any examples of how that is. So yes, would you like to enlighten us with an actual, factual, evidence-based position or counter position?
I doubt it. Instead you will talk about dogs or something. You're right; you don't have to search the internet for anything. That's fine. But when you come here and make a baseless, unproven, unbacked statement, you look really ignorant, and as if you have no clue what you're talking about. I came with facts, you came with "liar, liar, pants on fire." I'm not sure what world you live in, but in the adult world, facts win.
As far as being the "next Rush Limbaugh"... no, again, nice assumption. If you add all the Rush Limbaugh radio clips and shows I've listened to back to back, you might have 1 minute and 30 seconds of total time listening to him. He is a self promoter, I'm a fact promoter.
Thanks again for bringing nothing to this conversation. I would hope now that you've been challenged, that you can actually enlighten no only me, but the hundreds of other people that might read this. You're the reason this country is so divided. We post what we post so people can learn. You post what you post so they can't. So, can back what you say, or will this be another hollow, house-of-cards attack by someone who sees fact-based analysis and knows they can't get around it any other way?"
What lies? You all keep saying there are, and you never show any.
And anony - I don't think the original post was biased in favor of the claim. It appears like it simply wanted to disprove it. It did.
I'm getting a little tired of people that just fill up blogs with things like "# constant house of card lies." You talk shit but you can't back it up.
Oh i get it its april fools day lol.
ReplyDeleteTo all those that claim this article is somehow "lies" - if you're only counter argument is youre a liar, you lose this debate.... and you lose its very very badly
ReplyDeleteYour figures are accurate. However, the tax code rewards investment and entrepreneurship, rather than earned income; i.e. those who receive a W-2 at the end of the year. I am referring to Capital Gains and Dividend income which is taxed at a much lower rate than earned income. In other words, our Tax Code is based on income rather than assets and as such, effectively punishes those who receive wages as their tax rate is higher than one with the same income derived from investments.
ReplyDeleteThe payroll tax is another example. If one makes less than $106,800 per year, 100% of their income is taxed. Above that, the payroll tax rate is zero. Simply put, the tax code is not "unfair" it is simply "unjust" as most folks would disagree that a wage earner should pay more tax than someone who derives passive income from say, dividends on their securities holdings. The media displays a blatant ignorance of the tax code as evidenced by remarks "49% of the country doesn't pay Federal Taxes." The implication of that remark is (as Hannity is fond of saying) that they are "takers" and the ones who pay Federal Tax are "givers." There is a large percentage of taxpayers who fall into that 49% percent who are corporations (like GE) and investors who pay zero tax on their income because they have no "earned income."
You sound like you have a good grasp of the Tax Code and I do applaud you for beginning an honest conversation about the tax code. But let's tell all of it; not just the parts which suit our argument. And while we are all grovelling at the collective Corporate Altar and feeling "lucky" they "gave" us a job, let's remember, they wouldn't have the opportunity to make their money without their employees. Apple, for example, makes $400,000 profit (that's after expenses and before taxes) per employee.
Just something to think about. Great post :-)
May Day – Thank you for your post! Welcome to The Elephant in the Room… I hope you post more.
DeleteI am a little confused, however, about your response. I will try to answer your post the best I can. First, let me explain a little about the blog. We are a conservative blog (obviously), but we are respectful of all views. Unlike many blogs and message boards out there, we think civil, insightful debate is the best way to share information and to learn from each other, no matter how far apart our views are. What does that mean? It means we want informed, fact-based, debate. For our posts, we start discussions on a topic. We take a position, and we back and cite why we do. If people disagree, fine. We hope to learn why, and we hope to they share the facts behind where they stand.
For this post, we received a Twitter message that had a claim to it. Of course, we challenged (challenging for proof is a good thing) the claim for proof, and the maker of the claim provided none. To me, he was just chanting and ranting with a hot-air position (that someone making $57k in income paid 28% in taxes). How do we handle it at The Elephant in the Room? We investigate, and we use evidence, data, and facts. If we don’t have evidence, data, and facts, we will say we don’t have them up front, and we will broadcast that we don’t have them as well.
I completely understand the points you made; my only confusion stems from how they fit in here. In my analysis, I merely wanted to see if the claim was true or false, and if it was false, how much income would it take (even using the maximum applicable taxes) to make someone pay 28% in taxes. You made the statement, “However, the tax code rewards investment …. one with the same income derived from investments.” I’m not sure how this fits into the analysis. The analysis I did takes $57,000 of income and applies the applicable US tax bracket rates plus employment and SS taxes. If $57,000 was earned via investment income, then yes, the tax rate paid would have been lower. But for this analysis, it’s a simple look at the tax rate paid on $57,000.
Going forward, you said, “The payroll tax is another example. If one makes less than $106,800 per year, 100% of their income is taxed. Above that, the payroll tax rate is zero. Simply put, the tax code is not "unfair" it is simply "unjust" as most folks would disagree that a wage earner should pay more tax than someone who derives passive income from say, dividends on their securities holdings. The media displays a blatant ignorance of the tax code as evidenced by remarks "49% of the country doesn't pay Federal Taxes." The implication of that remark is (as Hannity is fond of saying) that they are "takers" and the ones who pay Federal Tax are "givers." There is a large percentage of taxpayers who fall into that 49% percent who are corporations (like GE) and investors who pay zero tax on their income because they have no "earned income."
(continued...)
continued:
DeleteAgain, this IS accounted for in the analysis above. The income earner making $57,000 does have a 7.65% payroll tax applied, and that totals $4,361. I understand your point (the argument against charging anything more than $106,800 is that for the wealthy, if/when they receive SS payments, it’s such a small % of their income/wealth, why should they pay more for it and get so little in return, respectively, especially since this is treated like a pension), but in my opinion, that’s a completely different tax policy issue. As far as the media’s claim… 47% don’t pay INCOME taxes is their claim, I’ve seen it no other way, and yes… this is true. As far as all taxes, some people say “well, people still pay SS/payroll taxes”… and yes, while that’s true, at the end of the year, most of these people get a refund back, and this actually makes their tax rate < 0%. So I don’t think the media’s claim goes far enough. With regards to tax policy in general (yes, a different argument) I think we should be taxed at a flat, equal rate. I don’t watch Hannity (I actually never have), but I do agree with the fact that we have a LOT of givers, and a LOT more takers. As far as the investors that pay 0% tax, that’s also not true, and very rare. If they have investment income (cap gains and/or dividends), it’s taxed at a different rate, but they still pay taxes. As far as the claim of GE, again, that’s another media-hyped myth.
As far as this, “You sound like you have a good grasp of the Tax Code and I do applaud you for beginning an honest conversation about the tax code. But let's tell all of it; not just the parts which suit our argument. And while we are all grovelling at the collective Corporate Altar and feeling "lucky" they "gave" us a job, let's remember, they wouldn't have the opportunity to make their money without their employees. Apple, for example, makes $400,000 profit (that's after expenses and before taxes) per employee.”
Please tell me how we are only telling part of the argument, and telling a part that benefits our views. I investigated a claim made by a person that couldn’t back it up himself. That’s the point of this post. As far as a tax policy debate, you actually went down that path (and that’s a GOOD thing… we want formal, civil debates here )… I’m just curious as to how, yes, from the standpoint of this blog, that we are a FLAT TAX promoter, we only tell half the story. I’m always open to constructive criticism. And as far as Apple’s profit is concerned… that’s a product of the demand for their products vs the supply of their products, and the demand for the labor to produce those products and the supply of that labor for those products.
Again, thank you for stopping by, and I hope to hear more. I would definitely like to hear how we aren’t telling the whole story. It would help us understand your point of view. We have plenty of tax policy posts throughout our blog… this one really wasn’t about tax policy, but a tax claim :-)... but again, I/we LOVE the additional discussion. That's what being an Elephant in the Room is all about!