Tax Reform Thread

[Kidlicious]

Do you understand the concept of progressive, flat, and regressive taxation?

[Hauldren Collider]

is the marginal rate of bull**** independent of the quantity?

[Kidlicious]

http://http://taxes.suite101.com/art...and_flat_taxes

Progressive, Regressive and Flat Taxes
How the United States Federal Income Tax Works
Share Article | Oct 4, 2009 James Hutchinson

Taxpayers in the U.S. are assessed based on a progressive tax system, where rates increase as income rises. Flat tax systems are another alternative.

A progressive tax system is designed so that individuals with greater income pay more taxes. The United States income tax system administered by the Internal Revenue Service is in theory a progressive tax system.

Individuals who earn small amounts of income pay no tax. When taxable income reaches a certain threshold, a tax is assessed at a certain percentage rate. When income reaches the next threshold, the percentage rate increases again.

For example:

Taxable income - less than $10,000 – tax rate is 0%
Taxable income - $10,000 to $30,000 – tax rate of 15%
Taxable income – more than $30,000 – tax rate of 28%
The ranges above are alos known as tax brackets. Rates and brackets can vary by taxing authority. Other countries and individual states in the U.S. also may have different rates. The concept of the progressive tax only means that there is an increase in the rate as income increases.

Why Don’t the Rich Pay More Tax?
In practice, those with more money do not always pay more tax. The reason is that tax is assessed based taxable income. Taxable income is different than earned income. Earned income is added to investment income, (or netted against investment losses) to arrive at adjusted gross income (AGI).

AGI is then reduced by deductions and exemptions to arrive at taxable income. Individuals can take advantage of methods to reduce taxable, known as tax shelters or tax breaks.

These shelters are often used by taxpayers to legally reduce their tax burden. After the tax amount is computed, tax can be further lowered by the use of tax credits. Although deductions and credits are available to all, some are out of reach of all but high-income individuals.

Flat Tax Systems
A flat tax system in its purest form would assess the same tax rate on all income. Some cities tax income in this method. This eliminates the use of deductions, making sure higher income individuals pay more tax.

A modified flat tax system will tax only income above a certain threshold, making them really a progressive tax. This can be a politically expedient solution, in that it allows for low income individuals to pay no tax, while taxing everyone else at the same rate.

Regressive Taxes
A regressive income tax system would be one where tax rates decline as income increases. Although this is not used in the United States, there are some who believe that tax money generated from gaming and tobacco use are regressive taxes.

If the lottery and cigarettes are used disproportionately by lower income individuals, they will pay more tax, but per person and as a percent of income.

[KrazyHorse]

Then the proposals you've seen are not FLAT TAX proposals. They're bull****.

I get it. You have nothing of value to say, so you'll continue to spout off about people who use a completely valid sense of the term being liars.

You're such a sad, bitter, stupid old man.

[Kidlicious]

Now that you call things by the opposite name we can safely assert that you live in your own universe. You've now joined the kind of right wing nut jobs that call liberals fascists.

Let's have a party in your honor.

[Drake Tungsten]

Today Is the Best Tax Day of Your Life

Looking back, we may all remember April 15, 2010, as the day we got off cheaply. Why a growing deficit and increased spending on health care and Social Security nearly guarantee higher tax bills in our future.

http://www.newsweek.com/id/236383

[Ogie Oglethorpe]

Yup. Lord knows I paid more in taxes last year than the Bidens and expect to have significantly more next year when tax cuts expire.

AMT blows.

[Kidlicious]

Today Is the Best Tax Day of Your Life

Looking back, we may all remember April 15, 2010, as the day we got off cheaply. Why a growing deficit and increased spending on health care and Social Security nearly guarantee higher tax bills in our future.

http://www.newsweek.com/id/236383

I'm sure no one has thought of that. Thanks again Drake for informing us.

[Hauldren Collider]

And despite this, Kid still seems to think that Obama's doing a terrific job