When the Bush Tax Breaks Expire

SamSpade

Well-Known Member
...how will it affect most of us?

Honestly - I don't know. I don't know what the breaks are that I enjoy, but I fully expect the verbiage from the Democratic Party to be, when the tax increases affect EVERYONE - not just the rich - that they didn't actually "raise" taxes.

Same with limiting or curtailing exemptions, deductions and lowering tax credits. They didn't "increase taxes".

It reminds me of those Ally Bank commercials - you know, like the one where the guy offers one girl a pony, and the other girl a REAL pony. In each one, they screw with the kids in minutiae over fine print and word games.

But the point of the commercial is that even a kid knows BS when they see it.
 

chernmax

NOT Politically Correct!!
...how will it affect most of us?

Honestly - I don't know. I don't know what the breaks are that I enjoy, but I fully expect the verbiage from the Democratic Party to be, when the tax increases affect EVERYONE - not just the rich - that they didn't actually "raise" taxes.

Same with limiting or curtailing exemptions, deductions and lowering tax credits. They didn't "increase taxes".

It reminds me of those Ally Bank commercials - you know, like the one where the guy offers one girl a pony, and the other girl a REAL pony. In each one, they screw with the kids in minutiae over fine print and word games.

But the point of the commercial is that even a kid knows BS when they see it.

Pelosi = We're allowing the Bush tax cuts to end, "we're not raising taxes, we're just not extending these tax cuts... :rolleyes:
 

bcp

In My Opinion
I doubt that the additional taxes wont really amount to enough to be noticed by most people.
It does irritate me however that for some reason pelosi and her gang of assclowns has a notion that they have any right to my money to start with.
 

chernmax

NOT Politically Correct!!
I doubt that the additional taxes wont really amount to enough to be noticed by most people.
It does irritate me however that for some reason pelosi and her gang of assclowns has a notion that they have any right to my money to start with.

They just want to give it to someone else but they want it coming from their hands so it increases their dependent voter cattle!
 

chawk

New Member
Relative comparison

What does it mean to you? Here is a relative comparison (from wikipedia) of pre-tax cut (2002) and post tax cut rates (2003 to current):

Married filing jointly or Qualifying widow(er)

Tax Year 2002 Tax Year 2003
Income level Tax rate Income level Tax rate
up to $12,000 10% up to $14,000 10%
$12,000 - $46,700 15% $14,000 - $56,800 15%
$46,700 - $112,850 27% $56,800 - $114,650 25%
$112,850 - $171,950 30% $114,650 - $174,700 28%
$171,950 - $307,050 35% $174,700 - $311,950 33%
over $307,050 38.6% over $311,950 35%

So if the cuts are allowed to expire, we can expect the rates and brackets to return to at least 2002 levels.

You have to look closely at the brackets: the $50,000 range under Bush cuts pays 15%; pre-Bush pays 27%. That's a 12% percent difference. Who says George favored the rich? it looks like he targeted the middle-class for the biggest tax decrease.

The $100,000 range goes from 25% up to 27%; a 2% difference.
 

itsbob

I bowl overhand
What I recall...

When the Bush tax cuts took effect they also changed the withholding. They no longer withheld as much each month. Your take home pay was drastically changed, at least MUCH more than the 2% tax cut should have reflected. In turn your income tax refund at the end of the year shrunk.

SO that being said. IF they turn back the clock on everything, not only the tax bracket, but the withholding, your take home pay is going to take a drastic cut. I'm thinking more in the neighborhood of 10 - 15%, but you'll get the majority of it back at the end of the year. You'll end up with 3- 5% less income overall, but they hope you won't actually figure that out with the loss in take home pay, and the huge increase in the refunds.
 

itsbob

I bowl overhand
Child tax credit is being cut in half. That is gonna hurt me.

So if you're on welfare, the more kids you have the more money you make.. but if you WORK, have a job, and pay taxes.. You'll make LESS??


Who could have guessed THAT was coming??
 
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bcp

In My Opinion
So if you're on welfare, the more kids you have the more money you make.. but if you WORK, have a job, and pay taxes.. You'll make LESS??


Who could have guessed THAT was coming??
anyone with a brain could have seen that coming.
those without a brain voted for the affirmative action kenyan.
 
E

EmptyTimCup

Guest
You have to look closely at the brackets: the $50,000 range under Bush cuts pays 15%; pre-Bush pays 27%. That's a 12% percent difference. Who says George favored the rich? it looks like he targeted the middle-class for the biggest tax decrease.




so I am I going to Owe more this tax yr or next ?

Guess I will not be getting a refund this yr.
 

theHypocrite

taking chances
fact - there is no evidence that the Bush tax cuts helped America

Americans were told it would improve the economy, increase job growth, blah, blah, blah ...

"There's an old saying in Tennessee — I know it's in Texas, probably in Tennessee — that says, fool me once, shame on — shame on you. Fool me — you can't get fooled again." — GWB
 

Rommey

Well-Known Member
Here's a copy of a post I did in 2005 on another forum, but I think it looks at the tax rates and the affect of the Bush Tax Cuts:


Here is some information I put together to illustrate how the past 6 years’ taxes were reduced among 3 different tax brackets. I used an example of a married couple with no kids and illustrated what the effective tax rate would have been for an income of $40K, $100K, and $1M (Purely arbitrary numbers, but the $40K and $100K figures are in the middle of their respective tax brackets). These examples are using the applicable standard deduction for each year listed, since itemized deductions are a huge variation. I concede that for a lot of taxpayers, the itemized deduction would be more advantageous, however this should be a pretty good illustration.


Code:
	MARRIED / $40,000 / NO KIDS		
YEAR	TAX		TAX RATE	EFFECTIVE TAX RATE
2004	$6025		25%		15.06%
2003	$6100		25%		15.25%
2002	$7061		27%		17.65%
2001	$7315		27.5%		18.29%
2000	$7574		28%		18.93%
1999	$7644		28%		19.11%
			
	
	MARRIED / $100,000 / NO KIDS		
YEAR	TAX		TAX RATE	EFFECTIVE TAX RATE
2004	$21025		28%		21.02%
2003	$21100		28%		21.10%
2002	$23261		30%		23.26%
2001	$23815		35%		23.82%
2000	$24374		31%		24.37%
1999	$24444		31%		24.44%

			
	MARRIED / $1,000,000 / NO KIDS		
YEAR	TAX		TAX RATE	EFFECTIVE TAX RATE
2004	$344435		35%		34.44%
2003	$344540		35%		34.45%
2002	$380654		38.6%		38.07%
2001	$385761		39.1%		38.58%
2000	$390872		39.6%		39.09%
1999	$390971		39.6%		39.10%

As you can see for the $40K examples, the tax rate went from 28% in 1999 to 25% in 2004 (a decrease, or tax cut, of 3%). The effective tax rate for that period went from 19.11% to 15.06% (a decrease of 3.05%).

In the $100K example, the tax rate went from 31% to 28% (a decrease of 3%). The effective tax rate went from 24.44% to 21.02% (a decrease of 3.42%).

In the $1M example, the tax rate went from 39.6% to 35% (a decrease of 4.6%). The effective tax rate went from 39.1% to 34.44% (a decrease of 4.66%).


Now I know people are going to point out that the higher tax bracket had a bigger percentage of decrease. While this is true, I would also like to point out that the middle class has also seen the tax rates and effective tax rate decrease over the past 6 years.
So its not really accurate to say that the tax cuts have been for the rich. Its more accurate to say that the tax cuts have been accross the board. Also not considered is the effect of the Earned Income Credit for the people in the lower tax bracket.
 
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