I knew we had some freeloaders, but Jesus!




It's no wonder we're about to tip over: http://www.usdebtclock.org





47% will pay no federal income tax
An increasing number of households end up owing nothing in major federal taxes, but the situation may not be sustainable over the long run.

By Jeanne Sahadi, CNNMoney.com senior writer
Last Updated: October 3, 2009: 2:58 PM ET

NEW YORK (CNNMoney.com) -- Most people think they pay too much to Uncle Sam, but for some people it simply is not true.

In 2009, roughly 47% of households, or 71 million, will not owe any federal income tax, according to estimates by the nonpartisan Tax Policy Center.

Some in that group will even get additional money from the government because they qualify for refundable tax breaks.

The ranks of those whose major federal tax burdens net out at zero -- or less -- is on the rise. The center's original 2009 estimate was 38%. That was before enactment in February of the $787 billion economic recovery package, which included a host of new or expanded tax breaks.

The issue doesn't get a lot of attention even as lawmakers debate how to pay for policy initiatives like health reform, whether to extend the Bush tax cuts and how to reduce the deficit.

The vast majority of households making up to $30,000 fall into the category, as do nearly half of all households making between $30,000 and $40,000.

As you move up the income scale the percentages drop.

Nearly 22% of those making between $50,000 and $75,000 end up with no federal income tax liability or negative liability as do 9% of households with incomes between $75,000 and $100,000.

Of course, income taxes don't tell the whole story. Workers are also subject to payroll taxes, which support Social Security and Medicare.

When considering federal income taxes in combination with payroll taxes, the percent of households with a net liability of zero or less is estimated to be 24% this year, according to the Tax Policy Center's estimates.

A key reason why there is a zero-liability group at all is because the U.S. tax system is progressive. Those who bring in more money pay more than those lower down the income scale to support government functions such as national defense and social safety nets like Medicaid for those in need. That progressivity can be dialed up or down.

"Some think it's too progressive. Some don't think it's progressive enough," said Roberton Williams, a senior fellow at the center.

President Obama falls into the latter camp. He has proposed increasing the income tax burden on families making more than $250,000 and individuals making more than $200,000, while offering new measures to reduce the tax bite for most Americans making less.

One of Obama's proposals is to extend the 2001 and 2003 Bush tax cuts for everyone except high-income tax filers, which was the group that derived the most benefit from those cuts.

As a result, under Obama's budget, he would keep the ranks of the non-payers higher than they would otherwise be.
Why the tax-free matter

The question of who pays and who doesn't is not a trivial matter. But Washington policymakers are not dealing with it in an explicit way.

And that's a problem, given the country's fiscal outlook.

If asked to vote up or down on whether they are comfortable with such a large group of voters contributing no federal income tax or payroll tax revenue, the majority may well decide it is appropriate given the means of the households involved. Or they may decide that it's not.

Either way, that decision should inform the debate about the many costly policies and deficit-reduction strategies that lawmakers will be grappling with for years to come.

"As the number [of nonpayers] becomes larger, we have to question whether we'll make good decisions about how to allocate resources," economist George Zodrow, a professor at Rice University. "Most people don't understand how skewed the tax distribution is."

Experts say that to pay for all the things on the country's growing tab, the money can't just come from a shrunken pool of taxpayers.

"Over the long run, you'll have to have a broader base," Zodrow said.

http://money.cnn.com/2009/09/30/pf/taxes/who_pays_taxes/index.htm

Well, I'm glad to see someone else who is now aware of who pays taxes and who doesn't. I could tell you some stories about people and their tax situation since I worked for a major tax preparation service last year. I couldn't get myself to do it again this year because of these 47% and their attitudes towards me. I was handing in $0 dollars due tax returns to the IRS, all with held money refunded, and because of the child tax credit, the additional child tax credit, and the Earned Income tax credit, I was handing out checks for $8,500. They called it their *refund*. Now, if we could make the other 53% aware of this...

Weren't those checks not from the IRS but from your tax prep firm and at triple pay day loan rates? Uh, never mind.

I know what I pay in taxes. Somewhere over 50% of every dollar I spend goes to the tax man. And in case anyone is wondering I've never in my life ever been able to file anything but a long form with a pile of attached schedules and forms.

Now I did see that the ADVANCE earned income credit was going away. On about January 15/16 you can expect to see some riots when people get a smaller paycheck.

Just read about progressive taxes:
http://online.wsj.com/article/SB10001424052748703581204576033861522959234.html
Did you know the USA has more progressive taxes than many European Countries?

---

Oh yes, and I suspect there will be riots when it is 2011 tax season. With the reduction in the withholding tables when they walk in expecting a big fat refund and instead have to write a check to Uncle Sam....

Oh well, nothing new to me, first estimated tax payment due April 15. Just hope I'll know how much to send.

---

Well, I'm glad to see someone else who is now aware of who pays taxes and who doesn't. I could tell you some stories about people and their tax situation since I worked for a major tax preparation service last year. I couldn't get myself to do it again this year because of these 47% and their attitudes towards me. I was handing in $0 dollars due tax returns to the IRS, all with held money refunded, and because of the child tax credit, the additional child tax credit, and the Earned Income tax credit, I was handing out checks for $8,500. They called it their *refund*. Now, if we could make the other 53% aware of this...

Weren't those checks not from the IRS but from your tax prep firm and at triple pay day loan rates? Uh, never mind.

I know what I pay in taxes. Somewhere over 50% of every dollar I spend goes to the tax man. And in case anyone is wondering I've never in my life ever been able to file anything but a long form with a pile of attached schedules and forms.

Now I did see that the ADVANCE earned income credit was going away. On about January 15/16 you can expect to see some riots when people get a smaller paycheck.

Just read about progressive taxes:
http://online.wsj.com/article/SB10001424052748703581204576033861522959234.html
Did you know the USA has more progressive taxes than many European Countries?

just read the first few line of your article. There is no "supposed" tax breaks for the wealth. there is and was a massive tax break to the wealthy. Quite honestly, I've not seen a dime in the tax breaks over the last 8 years. Maybe someone else in middle income did but I sure didn't. Those tax breaks went somewhere and its pretty clear it was upstairs. I'm glad the WSJ is still a stalwart Rag now that Murdock owns it. NOT

I'm sorry but I can't empathize with this story. It's like reading about the homeless guy down the street and how unfortunate he is. but in this story the homeless guy is the richest guy in town. boohoo. pay your taxes
BTW most middle income folks pay FICA which is Federal Insurance Contributions Act (FICA) tax. this is considered a payroll tax. I hope that they aren't using this as a talking point because thats annoying. Literally speaking I didn't pay income tax this last year or the year before because my taxes were taken out as a payroll tax. I overpaid which means I get a refund and did not pay income tax. Kinda dumb and misleading but it seems this is what they are doing with the numbers.

lets also look at the CNN article

When considering federal income taxes in combination with payroll taxes, the percent of households with a net liability of zero or less is estimated to be 24% this year, according to the Tax Policy Center's estimates.

less than 24% that's less outrageous than 47% why not print that? that 24% is probably at 150% of the poverty line or lower. so yes we should be upset. Thats to damned many people that are poor and something should be done to get them in better paying jobs like a BoD at GMC or any other Bankrupt Corporation. It seems that having an elite education doesnt prevent you from making horrific financial mistakes with your company perhaps you should give the less fortunate a try at a golden parachute

---

In a rich man's house there is no place to spit but his face.
Diogenes Of Sinope

A trend that may interest the real middle of the road person.

Leftists tend to seek the good in people while righties always seem to see people (read this as "poor people") as abusers of the system.

I think it goes back to the Cadillac driving black welfare mothers that Reagan made so famous in his statements as president while he rode the train down the losing his mind track.

---

I do not fight fascists because I think I can win.
I fight them because they are fascists.
Chris Hedges

A riot is the language of the unheard. -Martin Luther King, Jr.

Damn, I must need a better accountant....I always have to pay....

---

Official Abuser of Boinc Buttons...
And no good credit hound!

I am very well represented by my money. It listens to me and does my bidding.

Every Election Cycle my money gets reelected.

My kettle is letting me know it's time for a cuppa.

iWorm 'em.

A trend that may interest the real middle of the road person.

Leftists tend to seek the good in people while righties always seem to see people (read this as "poor people") as abusers of the system.

I think it goes back to the Cadillac driving black welfare mothers that Reagan made so famous in his statements as president while he rode the train down the losing his mind track.

The next year is going to be interesting. As donkey blue states (Kalifornia, New York, Illinois, Michigan and a bunch of others) tip over one by one because of decades of crazy radical leftist politics and unionized public pension promises that were never sustainable, don't dare coming running to the red states for bail outs.

The Kalifornia state legislature has been democratically controlled for 38 out of the last 40 years. That's no accident.

Most big U.S. cities have had Democrat mayors forever and donkey blue administrative arms that have gone unchecked with welfare abuse and unsustainable public worker pensions for way too many years. City finances are in shambles. Selections have consequences. There's nothing "middle of the road" in today's DNC.

Look for yourself...


http://globaleconomicanalysis.blogspot.com/2010/04/interactive-map-of-public-pension-plans.html

amazing.. after 8 years of red rule that created massive deficits, taking us from budget surpluses to unsustainable military spending, huge tax cuts for those with ample ability to pay, turning corporate america loose to feed on its citizens, you want to talk about the blue states problems??

News flash: all the states are purple. There are "blue" and "red" in all of them. And attempting to slander (btw, it is the right wing that is changing to term from "liberal" to "progressive", presumably because enough people were defending the liberal label) by using a string of terms that are really different to anyone having a tiny understanding of them... you really have a sad position.

Both Democrats and Republicans love to spend. Just on different things. I will admit there are great shortcomings in the democratic party. It is far too conservative.

So slander away boys. But you really are lacking. Seriously, is spelling California with a K supposed to work anymore? I thought that went out about 15 years ago.

The conservative wing tanked the economy. This included municipalities. I never asked for the "bush tax cuts". And as far as I am concerned they can stop them any time. Time to go back to paying up front. That means more taxes on those who can most afford it. So brace yourself.

---

Janice

It is still spelled with a K in Germany Soft.

---

Pluto will always be a planet to me.

Seti Ambassador
Not to late to order an Anni Shirt

It is still spelled with a K in Germany Soft.

Keith is not in germany. California is not in germany. The inference is towards socialist/communist. It was not lost on me. Just sad to see it.

---

Janice

Time for the flat tax.
A percentage of what you earn.
No exceptions, no long forms, no excuses.
Same for everybody...we all pull our weight to our ability to pay.

Little guy, little tax.
Big guy....making a million or more a year....sorry, no more tax shelters and loopholes....you gotta pay into the system that allowed you to make that million.
Midrange folks like myself finally pay a respective tax burden, not supporting the arses of everybody else.

This idea's time has come........

---

"Freedom is just Chaos, with better lighting." Alan Dean Foster

It is still spelled with a K in Germany Soft.

Keith is not in germany. California is not in germany. The inference is towards socialist/communist. It was not lost on me. Just sad to see it.

Wirklich? Wo bin ich? Es ist nicht Deutschland? Ist die netz durch die ganzen welt?

Kalifornien is nicht Kommunist. Aber die regierung von Kalifornien ist.

Ein schoenen tag noch.

It is still spelled with a K in Germany Soft.

Keith is not in germany. California is not in germany. The inference is towards socialist/communist. It was not lost on me. Just sad to see it.

Wirklich? Wo bin ich? Es ist nicht Deutschland? Ist die netz durch die ganzen welt?

Kalifornien is nicht Kommunist. Aber die regierung von Kalifornien ist.

Ein schoenen tag noch.

Uhh.....English speaking forum.......

And besides......most of this discussion is based in the USA.

And I am German by birth, mind you. From 2nd gen German parents born here.

---

"Freedom is just Chaos, with better lighting." Alan Dean Foster

Hahaha - blue states are purple - yea, whatever. That's rich!

Paleeze - everyone knows democrats are THE biggest spenders by far.

http://www.ntu.org/ntuf/billtally-111-1.html

http://www.ntu.org/ntuf/billtally.html

Time to start slashing the progressive welfare state to the bone. The founding fathers would be appalled at what the land of the "free" has turned into.

Obama/Reid/Pelosi have revved blue spending into high gear in only two years.

You want it, YOU pay for it.

red states are purple too. Not everyone in those states agrees with the neo-con agenda.

---

Janice

side note: republicans are much bigger at military (the LARGEST expense in the Govt Budget) Spending. We squandered how much in Iraq so far??

---

Janice