Thursday, October 26, 2017

Tax Cuts for the Wealthy paid for by Middle-Class, with repeal of Estate Tax and Deduction for State and local Taxes.

Trump economic "policy" (seriously, does he have any idea at all?), builds on the old disproven myths of long-dead GOP talking points. For instance...

The DEATH TAX!!! SCARY: There is no death tax because when you're dead, you don't exist and therefore can't be taxed. Make sense? Not to Republicans. 

As hard as Chris Hayes tried to make that point below, he still failed to get through to Rep. Matt Gaetz of Florida, who still thinks farmers are losing out to the estate tax. Not true, and never has been true (more on that with an eye-opening clip below of Sen. Grassley).

And when it comes to middle-class killing repeal of the deduction for state and local taxes on your Federal taxes (more below from Mayor Soglin), the party supposedly against one-size-fits-all laws wants to accomplish just that nationally, by basically forcing high tax states and municipalities to cut their taxes due to the lost deduction. This proves Republicans have no concept of budgeting:


Here's Sen. Chuck Grassley openly admitted the death tax deception is all based on what people end up thinking is true, even if it isn't. Jaw dropping stuff:
Grassley: "I have a lot of people in my neighborhood that would fall into the category of having to pay the estate tax, and they worry about it. Now is that worry legitimate? You know, you have to ask them." 
Yea, if they are worried for no reason at all, Grassley's not going to tell ease their fears:



Below is the complete clip from the show Market to Market, with a detailed breakdown that destroys the myth of the death tax:
Announcer: "In farm country, $5.4 million is the average value of 764 acres of Iowa farmland, which according to the USDA, is twice the size of the average Iowa farm... 

Announcer: "Only 5500 of the 3 million estates settled in 2017, would have to pay any taxes, and of that only 80 would have to pay the estate tax. When asked about any specific instances of heirs selling portions of farms to pay estate taxes, Grassley could not immediately sight a case."
Middle-Class Tax Hike by eliminating State and Local Tax Deductions: First an update on the GOP's latest ruthless attempt to make low and middle-class Americans pay more...while giving business a pass on taking away the state and local tax deduction:
House Ways and Means Committee Chairman Kevin Brady, R-Texas, said Wednesday that he expected to keep an apparently limited version of the state and local tax deduction for individual Americans, a break that party leaders had targeted for elimination in their tax overhaul plan ... the deal would involve allowing individuals to write off property taxes but not state and local income or sales taxes.

Brady also confirmed that the bill would not make any changes to the ability of companies to deduct state and local taxes as a business expense. Democrats have criticized Republicans for proposing to kill the break for individuals but keep it in place for businesses.
Revenge is "Trump" Sweet: Trump a revenge kind of guy, and Republican plans to penalize Democratic states is a no-brainer:
Repealing the deduction would lead to an average tax hike of $3,218 for Californians who claim it, according to the nonpartisan Tax Policy Center. Most of the states that would be hit hardest by the loss of the deduction are Democratic strongholds. Of the top 10 states for the deduction, Trump carried only three in last fall's election.
Even sweeter, a complete 180 and abandonment of those forgotten Trumpian true believers who feel they were passed over by their government:
Eliminating the deduction would generate as much as $1.8 trillion over the next decade and help pay for the large tax cuts in the Republican plan that, based on details released so far, are focused on corporations and the wealthy.
Madison  Mayor Paul Soglin wrote the opinion below based on math and two separate studies that sounded the alarm to Americans everywhere, especially resentful Trump supporters, that the Republican tax reform debacle will hit the middle class hard:
It appears many middle-income homeowners will see their taxes go up, not down, under the GOP’s Big Six plan … takes away the most popular — and one of the most valuable — deductions for households, which is widely taken by middle-income homeowners: the deduction for state and local taxes.

The state and local tax deduction is claimed by 44 million American households on their federal returns … nearly 86 percent have incomes under $200,000.… Washington has this deduction in its crosshairs because eliminating it raises $1.6 trillion over 10 years that tax writers can use to fund other tax breaks, some of which have nothing to do with the middle class.

An analysis prepared by the National Association of Realtors found that homeowners with average gross income between $50,000 to $200,000 would see their taxes go up with an average increase of $815, even if the standard deduction were doubled. NAR found that housing values might drop about 10 percent because tax reform would increase the after-tax cost of housing and dampen demand.

The independent Urban-Brookings Tax Policy Center’s analysis similarly concluded that nearly 30 percent of taxpayers with incomes between $50,000 and $150,000 would see a tax increase under the proposed plan, due in part to the elimination of the deduction for state and local taxes.

So eliminating the deduction would result in a triple whammy for many middle-class taxpayers: higher taxes, lower home values, and fewer public services that make communities vibrant and attractive places to live. 
One more point. Those higher tax states are most likely higher contributing states to the national economy. Resentfully bringing these states down to the level of those more impoverished states, well, that's how Republicans work. These states will also end up sending more money to Washington, get less back, and keep sending the same subsidies to federally dependent states. Check out the interactive map, see for yourself:

2017’s Most & Least Federally Dependent States


Source: WalletHub
Trump administration officials and top congressional Republicans said the state and local tax deduction mostly helps high earners and forces residents in low-tax states to subsidize those in high-tax states.

House Republicans from high-tax states have pushed to save the deduction by adding new limits. One proposal would limit the deduction to individuals with adjusted gross incomes of no more than $400,000, or $800,000 for married couples.

Such a limit would preserve the deduction for all but the top 1 percent of earners _ those with adjusted gross incomes above about $465,000 _ according to an analysis by the Tax Foundation. But limiting rather than scrapping the deduction would raise only about a quarter of the additional revenue that Republicans are seeking to offset their tax cuts.

5 comments:

  1. You're a special kind of stupid.

    https://www.youtube.com/watch?v=km9OCw3f5w4

    ReplyDelete
  2. Freidman would be right if, in fact, we had a "family society." We don't. Things I earn in my lifetime doesn't belong to my kids, my relatives or anyone else. That would be really messy, wouldn't it?

    The estate tax is incredibly high, and that's the point made in this story...are you dense or too ideologically blind to see that? The only people really affected? Nonfarm wealthy people. And that's the GOP's main purpose. You know, as much as I include way too much information in these long posts, it apparently isn't enough.

    ReplyDelete
  3. No. Instead you would rather enslave your kids with lots and lots of debt. Now you're going to send them to college to earn their transgender studies degrees where they will be saddled with student loans for the rest of their natural born lives and be able to get a wonderful part time job as a barista at Starbucks.

    Excellent parenting skills you have. Bravo.

    A special kind of stupid. Doesn't/Don't same thing. Speak English. 56% of America still does.

    ReplyDelete
  4. Written like a dedicated GOP freeloader, like you Care about my kids paying high taxes. Walker republicans not rebuilding or maintaining what we have now, sounds like pushing all this off onto our kids.

    ReplyDelete
  5. That's true. I don't care about you or your kids. But I would think you would!!! Why did you even have kids if you don't want them to have a better life than you did?

    You said, "Things I earn in my lifetime doesn't belong to my kids, my relatives or anyone else. That would be really messy, wouldn't it?"

    Now you know why socialism or redistribution of wealth is just force. My money is mine. Your money is yours. I don't want yours. And you shouldn't want mine.

    The freeloader is the one who tries to force others to pay for everyone else. How many tens of thousands of dollars in direct income taxes did you pay again last year?

    You really are a special kind of stupid. And a hypocrite who still has no clue how this economy or money creation works. If you want to rebuild something, then get to work. But just because you want it, doesn't mean the capital exists to do it or that you can force everyone else to do it.

    But good luck trying. It's funny and entertaining to watch you try.

    ReplyDelete