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Out of the Blue

Happy tax day, as today is the deadline for filing income taxes here in the U.S.A. Hopefully everyone who is facing this has all the paperwork in order, my heart goes out to anyone still struggling with those taxing forms. Today is also the anniversary of the sinking of the RMS Titanic. That was 107 years ago, so we can probably call off the search party for Jack (spoiler alert!).

Taxing Links: Thanks Ant.
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There Are Fungi All Over the Space Station, and Now We Know What They Are.
Media: Jump Jump!
Burglary In Progress. SWATed!
Fed Ex driver does a drive by shooting.

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26. Re: Out of the Blue Apr 16, 2019, 20:02 jdreyer
 
Kxmode wrote on Apr 16, 2019, 16:14:
Mr. Tact wrote on Apr 16, 2019, 09:11:
jdreyer wrote on Apr 16, 2019, 04:59:
Here's my proposal. Here's the Fed income tax, no loopholes or exemptions.

$0 - 25K: . . No Federal Tax
$25K - 50K: . 5%
$50K - 100K:. 10%
$100K - $1M:. 25%
$1M - $10T: . 50%

The one exemption I'd allow would be dependent: $10K per dependent child up to two. After that, 0. $10K per disabled dependent (wife, mother, etc. that you claim).

Also, let's get rid of the $100K limit on the payroll tax for SS. That would go a long way in making SS solvent.
I would vote for that.

There's no way a person making $1M+ would give up half their income to a flat tax (or any tax for that matter) and would likely result in their leaving and the government not getting anything. 20-25% of $1M+ is a lot of money, but it is also a fair share percentage for high-income earners. Beyond the math, there are also psychological factors for why the portion should be 20-25% (for example, the sage advice that mortgages should be no more than 25% of their income). Anything more than that creates a risk.

Further, the example jdreyer cites isn't strictly speaking fair-share. The more money someone makes, the more they pay. Nevermind the fact that mathematically speaking 20-25% on $1M+ is already significantly higher than 20-25% on $25K, $65K, or $200K. The percentages must be leveled; otherwise, it cannot be called a flat-tax.

You're not reading my proposal right. These are marginal rates. Nobody pays taxes on the first 25K they earn. The next 25K someone earns is taxed at 5%, etc. This means if your salary is $100K, you're paying $6250 in taxes. 200K pays about 31K. 1M pays about 231K, or 23.1%, right in your ballpark. Someone earning 2M pays 23% on that first mil, and 50% on the second. That person still has more than 1.25M to play around with.

Taxing high salaries at a high rate has other benefits, like disincentivizing super high C level salaries which can damage businesses.

One place I would like to see a "flat tax" is for things like fines. If running a stop sign (which Mercedes drivers do around 40% of the time) cost 1% of your annual compensation, the law would be a lot more equitable. Would also be funny to see police pull over expensive cars, which they don't do now, knowing it's a waste of time.
 
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25. Re: Out of the Blue Apr 16, 2019, 16:14 Kxmode
 
Mr. Tact wrote on Apr 16, 2019, 09:11:
jdreyer wrote on Apr 16, 2019, 04:59:
Here's my proposal. Here's the Fed income tax, no loopholes or exemptions.

$0 - 25K: . . No Federal Tax
$25K - 50K: . 5%
$50K - 100K:. 10%
$100K - $1M:. 25%
$1M - $10T: . 50%

The one exemption I'd allow would be dependent: $10K per dependent child up to two. After that, 0. $10K per disabled dependent (wife, mother, etc. that you claim).

Also, let's get rid of the $100K limit on the payroll tax for SS. That would go a long way in making SS solvent.
I would vote for that.

There's no way a person making $1M+ would give up half their income to a flat tax (or any tax for that matter) and would likely result in their leaving and the government not getting anything. 20-25% of $1M+ is a lot of money, but it is also a fair share percentage for high-income earners. Beyond the math, there are also psychological factors for why the portion should be 20-25% (for example, the sage advice that mortgages should be no more than 25% of their income). Anything more than that creates a risk.

Further, the example jdreyer cites isn't strictly speaking fair-share. The more money someone makes, the more they pay. Nevermind the fact that mathematically speaking 20-25% on $1M+ is already significantly higher than 20-25% on $25K, $65K, or $200K. The percentages must be leveled; otherwise, it cannot be called a flat-tax.
 
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William Shakespeare's "Star Wars" Act I, Scene 1: Aboard the rebel ship. / Enter C-3PO and R2-D2. / C-3PO: "Now is the summer of our happiness / Made winter by this sudden, fierce attack!" / R2-D2 Beep beep, Beep, beep, meep, squeak, beep, whee!
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24. Re: Out of the Blue Apr 16, 2019, 09:11 Mr. Tact
 
jdreyer wrote on Apr 16, 2019, 04:59:
Here's my proposal. Here's the Fed income tax, no loopholes or exemptions.

$0 - 25K: . . No Federal Tax
$25K - 50K: . 5%
$50K - 100K:. 10%
$100K - $1M:. 25%
$1M - $10T: . 50%

The one exemption I'd allow would be dependent: $10K per dependent child up to two. After that, 0. $10K per disabled dependent (wife, mother, etc. that you claim).

Also, let's get rid of the $100K limit on the payroll tax for SS. That would go a long way in making SS solvent.
I would vote for that.
 
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23. Re: Out of the Blue Apr 16, 2019, 07:17 Beamer
 
Kxmode wrote on Apr 16, 2019, 00:35:
Beamer wrote on Apr 15, 2019, 22:49:
A flat tax makes the rich richer. It means property gets more expensive, and more goods are made solely for the rich. There's a limited amount of income in the us, so think less about your absolute take home and more about your share.

With a flat tax, your share is less. People always think about their take home, not about its actual purchasing power.

I understand how it might appear like an FT would make an affluent person more affluent. However, the basic math for why it works is a flat tax is an emotionless percentage of income. A person earning a living cannot escape taxes collected from their paycheck. It happens now. Person A making $15 p/hour and Person B making $300 p/hour both pay taxes. The difference is the current tax laws allow Person B to play the system to pay less than Person A from a percentage standpoint. Under the flat tax, they both pay the same proportion. I chose 20-25% because that's not burdensome to anyone. It is fair across all incomes.

Further, a flat tax flexibly adjusts to situations where a person got a raise or took a job for less pay. April 15th exists to determine if the government took too much and owes you, or you didn't pay enough, and you owe them. By flat-taxing income at the paycheck level, this effectively eliminates the need for April 15th for most people. By that date, regular income workers would have paid their fair share every time they got a paycheck. For those earning a self income, they would have to set aside 20% of their earnings and pay this as per usual by the April 15 deadline; or they could pay in advance, whichever is more comfortable.

Does that clarify?

You're a computer developer, not an economist, for a reason.

First off, your person a, person b scenario doesn't work, because of capital gains, which no flat tax system taxes flatly. Second off, your new job or raise scenario makes me question if you understand how marginal tax rates work - why is a raise an issue? If your company's payroll department does it's job, it isn't.

Again, these just make the rich wealthier, and the issue isn't that most Americans don't have enough money, it's that they don't have enough proportion of it. When one class gets wealthier, another gets poorer. Which side of that line do you fall on?
 
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22. Re: Out of the Blue Apr 16, 2019, 04:59 jdreyer
 
Kxmode wrote on Apr 15, 2019, 18:36:
Mr. Tact wrote on Apr 15, 2019, 18:04:
W2, right -- I "misspoke" when I said W4. I can't see a flat tax ever passing and I don't think a single rate flat tax for everyone would be "fair".

It's fair from the stand point of a percentage of income meaning EVERYONE from the poor to the rich pay their share. Case in point:

Poor example: Annual salary $26,750 / 20% FT = $5,350 = Remaining $21,400
Medium example: Annual salary $65,000 / 20% FT = $13,000 = Remaining $52,000
Rich example: Annual salary $190,000 / 20% FT = $38,000 = Remaining $152,000
Wealthy example: Annual salary $1.5 Million / 20% FT = $300,000 = Remaining $1.2 Million

The remaining is basically free of additional taxes. The person actually has more in their pocket.

Did you even read what you typed? You're going to take $5K from someone who made only $25K last year??? Currently that person pays about $100 in taxes because the standard deduction is $24K. You would be dooming that person to a life of miserable poverty. Do you hate the poor? Sheesh, and we think income inequality is bad now...

1. Economies work best when people spend money. Who spends almost all of their money? Poor and middle class people. From an economic standpoint, it makes the economy stronger to not tax the poor (who already pay SS and Medicare).

2. The rich made their money by relying on and taking advantage of the infrastructure and safety provided by the government in a greater fashion than the poor. They also have much more to lose. This isn't just in a linear fashion, but logarithmically. Logically it makes sense for them to pay a higher percentage.

3. There are complicated cascade effects on things like the housing market, healthcare, and retirement funds because there are tax incentives to those. You'd have to design programs to mitigate these over decades to avoid a major economic disruption if you implemented a flat tax reducing the simplicity appeal.

4. A flat tax makes the rich richer. Certainly your support of it is due to the fact that you'd pay less. You're probably paying 25% or more in all of your taxes based on your income as a developer. 20% (state and fed inclusive) would dramatically reduce your rate.

5. Speaking of the states, each state has control over state taxes, and each state is unique in its implementation. You can't control how much the states take at the federal level, as suggested by your example.

6. Nearly all of the flat taxes proposed over time have not been high enough to cover government spending, which is currently around $3.3T per year. So they'd increase the national debt. Make it high enough to fix this problem, and you doom the poor and crush the middle class.

Here's my proposal. Here's the Fed income tax, no loopholes or exemptions.

$0 - 25K: . . No Federal Tax
$25K - 50K: . 5%
$50K - 100K:. 10%
$100K - $1M:. 25%
$1M - $10T: . 50%


The one exemption I'd allow would be dependent: $10K per dependent child up to two. After that, 0. $10K per disabled dependent (wife, mother, etc. that you claim).

Also, let's get rid of the $100K limit on the payroll tax for SS. That would go a long way in making SS solvent.
 
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21. Re: Out of the Blue Apr 16, 2019, 01:40 MoreLuckThanSkill
 
Kxmode wrote on Apr 16, 2019, 00:35:

I chose 20-25% because that's not burdensome to anyone. It is fair across all incomes.


Ah, the old flat tax pipe dream. Try to imagine somebody attempting to live off minimum wage (or effectively less due to being part time) and getting taxed 20-25% of their income. They would quite literally not be able to survive legally. On the other end of the spectrum, some CEO making $500 million a year would grumble, but still be exceedingly well off. Then next year that CEO would drop his salary to $1 and just get paid in stock options, but I digress. I know your 20-25% is just a number out of a hat basically, but it's the same story for anything above even double digits if you're already below the poverty line. Much of this country cannot even afford to pay taxes as it is.

Don't get me wrong, a flat tax could conceivably benefit me personally quite a bit, but the reality is a flat tax would disproportionally harm people in lower income brackets. The rich would just continue to evade paying taxes and nothing would improve.

The only real tax reform this country needs: No more tax exemptions for religious organizations, no offshore tax shelters for corporations or the ultra wealthy, and forensic IRS accountants going after the mega-rich who continue to avoid paying taxes. A return to 1940s style tax percentages would also help greatly, but good luck to any politician trying to do that.


 
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20. Re: Out of the Blue Apr 16, 2019, 01:28 MoreLuckThanSkill
 
Jivaro wrote on Apr 15, 2019, 21:27:
So a dinosaur finally got fed up with Florida man's shit eh?

Sorry, the dude is dead and I probably shouldn't joke about that...but what the hell is it with the men in Florida anyway? I live in California, quite literally the historical home of batshit crazy people, and yet my news feed is like 20% headlines that begin with "Florida Man".

Don't worry, there are stupid people worldwide. However, Florida does have a rather weird law/statute that any criminal act can (must?) be made public, and the weirder ones tend to sift up to the national level, or at least internet level, briefly. Obviously this Cassowary related death wasn't a crime, but you're going to get inundated with other Florida Man stories all the time.

Also, how the fuck is this guy breeding Cassowaries? Who the hell would even buy these things!? Off the books zoo purchases? Anyway, apparently breeding them isn't illegal in Florida.
 
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19. Re: Out of the Blue Apr 16, 2019, 00:35 Kxmode
 
Beamer wrote on Apr 15, 2019, 22:49:
A flat tax makes the rich richer. It means property gets more expensive, and more goods are made solely for the rich. There's a limited amount of income in the us, so think less about your absolute take home and more about your share.

With a flat tax, your share is less. People always think about their take home, not about its actual purchasing power.

I understand how it might appear like an FT would make an affluent person more affluent. However, the basic math for why it works is a flat tax is an emotionless percentage of income. A person earning a living cannot escape taxes collected from their paycheck. It happens now. Person A making $15 p/hour and Person B making $300 p/hour both pay taxes. The difference is the current tax laws allow Person B to play the system to pay less than Person A from a percentage standpoint. Under the flat tax, they both pay the same proportion. I chose 20-25% because that's not burdensome to anyone. It is fair across all incomes.

Further, a flat tax flexibly adjusts to situations where a person got a raise or took a job for less pay. April 15th exists to determine if the government took too much and owes you, or you didn't pay enough, and you owe them. By flat-taxing income at the paycheck level, this effectively eliminates the need for April 15th for most people. By that date, regular income workers would have paid their fair share every time they got a paycheck. For those earning a self income, they would have to set aside 20% of their earnings and pay this as per usual by the April 15 deadline; or they could pay in advance, whichever is more comfortable.

Does that clarify?
 
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William Shakespeare's "Star Wars" Act I, Scene 1: Aboard the rebel ship. / Enter C-3PO and R2-D2. / C-3PO: "Now is the summer of our happiness / Made winter by this sudden, fierce attack!" / R2-D2 Beep beep, Beep, beep, meep, squeak, beep, whee!
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18. Re: Out of the Blue Apr 15, 2019, 22:49 Beamer
 
A flat tax makes the rich richer. It means property gets more expensive, and more goods are made solely for the rich. There's a limited amount of income in the us, so think less about your absolute take home and more about your share.

With a flat tax, your share is less. People always think about their take home, not about its actual purchasing power.
 
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17. Re: Out of the Blue Apr 15, 2019, 22:47 jdreyer
 
Jivaro wrote on Apr 15, 2019, 21:27:
So a dinosaur finally got fed up with Florida man's shit eh?

Sorry, the dude is dead and I probably shouldn't joke about that...but what the hell is it with the men in Florida anyway? I live in California, quite literally the historical home of batshit crazy people, and yet my news feed is like 20% headlines that begin with "Florida Man".
Florida has had some of the most robust transparency laws for a century. Combine that with a tropical climate and a large and diverse population, and Florida man was born. There are plenty of stories in California, but they aren't as readily available for publication.
 
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16. Re: Out of the Blue Apr 15, 2019, 21:27 Jivaro
 
So a dinosaur finally got fed up with Florida man's shit eh?

Sorry, the dude is dead and I probably shouldn't joke about that...but what the hell is it with the men in Florida anyway? I live in California, quite literally the historical home of batshit crazy people, and yet my news feed is like 20% headlines that begin with "Florida Man".
 
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15. Re: Out of the Blue Apr 15, 2019, 20:11 Mr. Tact
 
I consider the likelihood that all those taxes would be eliminated even less likely than a flat tax of some kind will ever become law in the USA.  
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14. Re: Out of the Blue Apr 15, 2019, 18:47 Kxmode
 
Mr. Tact wrote on Apr 15, 2019, 18:40:
Uh, yes. I can do the math. Your point is not compelling(to me).

By the end of the year, people paid a wide array of taxes (e.g. income, food, gas, utilities, consumer goods, properties, rental, entertainment, and so forth). The idea by going flat tax and eliminating taxes after means mathematically there's more money in people's pocket by year's end. Not sure how that wouldn't be compelling. It's compelling to me.
 
Avatar 18786
 
William Shakespeare's "Star Wars" Act I, Scene 1: Aboard the rebel ship. / Enter C-3PO and R2-D2. / C-3PO: "Now is the summer of our happiness / Made winter by this sudden, fierce attack!" / R2-D2 Beep beep, Beep, beep, meep, squeak, beep, whee!
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13. Re: Out of the Blue Apr 15, 2019, 18:40 Mr. Tact
 
Uh, yes. I can do the math. Your point is not compelling(to me).  
Truth is brutal. Prepare for pain.
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12. Re: Out of the Blue Apr 15, 2019, 18:36 Kxmode
 
Mr. Tact wrote on Apr 15, 2019, 18:04:
W2, right -- I "misspoke" when I said W4. I can't see a flat tax ever passing and I don't think a single rate flat tax for everyone would be "fair".

It's fair from the stand point of a percentage of income meaning EVERYONE from the poor to the rich pay their share. Case in point:

Poor example: Annual salary $26,750 / 20% FT = $5,350 = Remaining $21,400
Medium example: Annual salary $65,000 / 20% FT = $13,000 = Remaining $52,000
Rich example: Annual salary $190,000 / 20% FT = $38,000 = Remaining $152,000
Wealthy example: Annual salary $1.5 Million / 20% FT = $300,000 = Remaining $1.2 Million

The remaining is basically free of additional taxes. The person actually has more in their pocket.
 
Avatar 18786
 
William Shakespeare's "Star Wars" Act I, Scene 1: Aboard the rebel ship. / Enter C-3PO and R2-D2. / C-3PO: "Now is the summer of our happiness / Made winter by this sudden, fierce attack!" / R2-D2 Beep beep, Beep, beep, meep, squeak, beep, whee!
Reply Quote Edit Delete Report
 
11. Re: Out of the Blue Apr 15, 2019, 18:04 Mr. Tact
 
W2, right -- I "misspoke" when I said W4. I can't see a flat tax ever passing and I don't think a single rate flat tax for everyone would be "fair".  
Truth is brutal. Prepare for pain.
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10. Re: No tax cut for me Apr 15, 2019, 17:52 Kxmode
 
Mr. Tact wrote on Apr 15, 2019, 16:31:
Kxmode wrote on Apr 15, 2019, 16:08:
I ended up owing to federal. I decided to change my fed exemptions from 3 to 1. Next year IRS is going to introduce a major change to how exemptions are calculated and it's not going to be easy.
Yeah, I was reading about the new w-4s the other day. I just don't see the point unless they are going to do something like put a $100 buffer on tax outcomes. That is to say, if your taxes calculate between you owing up to $99.99 or being due a refund of up to $99.99 it is ignored by law. Because otherwise I can't imagine they can reduce the total number of refunds or people owing taxes by any significant amount. Which is, as I understand it, supposedly the thing they are attempting to do...

As I read it, the purpose is to make deductions more accurate so that people keep more of what they earn while enabling the feds not to give back so much. The problem then isn't so much the proposed complexity of the W2 but the fact that this reemphasizes the inherent complexities with taxes.

A simple across-the-board 20-25% flat tax is the best solution. As a breakdown 10/12.5% goes to the state, 10/12.5% to the feds. This deduction would come out of everyone's paycheck regardless, so there's no way to cheat or not pay it. As an offset, there would be no taxes on consumer goods, properties taxes, investments, or anything else. In other words, after paying the flat tax, the remaining income is yours to do with as you please without additional burdens. I think that would be the best way to make taxes more simple.
 
Avatar 18786
 
William Shakespeare's "Star Wars" Act I, Scene 1: Aboard the rebel ship. / Enter C-3PO and R2-D2. / C-3PO: "Now is the summer of our happiness / Made winter by this sudden, fierce attack!" / R2-D2 Beep beep, Beep, beep, meep, squeak, beep, whee!
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9. Re: No tax cut for me Apr 15, 2019, 16:31 Mr. Tact
 
Kxmode wrote on Apr 15, 2019, 16:08:
I ended up owing to federal. I decided to change my fed exemptions from 3 to 1. Next year IRS is going to introduce a major change to how exemptions are calculated and it's not going to be easy.
Yeah, I was reading about the new w-4s the other day. I just don't see the point unless they are going to do something like put a $100 buffer on tax outcomes. That is to say, if your taxes calculate between you owing up to $99.99 or being due a refund of up to $99.99 it is ignored by law. Because otherwise I can't imagine they can reduce the total number of refunds or people owing taxes by any significant amount. Which is, as I understand it, supposedly the thing they are attempting to do...
 
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8. Re: No tax cut for me Apr 15, 2019, 16:08 Kxmode
 
Mr. Tact wrote on Apr 15, 2019, 14:25:
For the record, my tax rate (federal tax paid/AGI) went up by half a percent over last year. The rule changes around personal exemptions ended up lowering my income reductions by about $2k.

I ended up owing to federal. I decided to change my fed exemptions from 3 to 1. Next year IRS is going to introduce a major change to how exemptions are calculated and it's not going to be easy.
 
Avatar 18786
 
William Shakespeare's "Star Wars" Act I, Scene 1: Aboard the rebel ship. / Enter C-3PO and R2-D2. / C-3PO: "Now is the summer of our happiness / Made winter by this sudden, fierce attack!" / R2-D2 Beep beep, Beep, beep, meep, squeak, beep, whee!
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7. Re: Out of the Blue Apr 15, 2019, 16:04 jdreyer
 
Kxmode wrote on Apr 15, 2019, 16:02:
Samsung Galaxy Fold USD$1,980.

Sounds reasonable. I'll take one for each member of my family.
 
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The land in Minecraft is flat, Minecraft simulates the Earth, ergo the Earth is flat.
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