Taxes: December 2010 Archives
A lot of my friends are asking "WHAT?"
But I am advocating for a plan that has already been presented and gives the maximum benefit only to those who have $250,000 or more in taxable wages.
If you have a gross income of only $250,000, you won't get the maximum benefit. This is because your taxable income will be lower: due to exemptions for yourself and your dependents, head of household adjustments, the standard or your itemized deductions (which can include health care, the mortgage interest on your home(s), cost of your au pair or nanny, etc.). No, after you take all your deductions, you have to still have at least $250,000 in taxable earnings to get the greatest benefit.
The plan I'm talking about is the one put forward by President Obama.
Now everyone is asking "WHAT??!!!"
Here's why Obama's plan provides the greatest benefit to those who have a quarter million dollars or more in taxable income:
The tax cut is a percentage on the first $250,000 of taxable income. If you have only $20,000 in taxable income, your tax break is a percentage of $20,000. If you have $250,000 or more in taxable income, you get the maximum dollar amount of tax break.
Those who argue for a tax cut on compensation for income above $250,000 are arguing for an additional tax cut that only applies to the 2% of Americans who A) receive more than that in wages and B) haven't managed to find enough tax shelters to hide it all.
I understand that times are tough, but they're not tougher for people in the upper 2% of income than they are for the rest of us.
But I am advocating for a plan that has already been presented and gives the maximum benefit only to those who have $250,000 or more in taxable wages.
If you have a gross income of only $250,000, you won't get the maximum benefit. This is because your taxable income will be lower: due to exemptions for yourself and your dependents, head of household adjustments, the standard or your itemized deductions (which can include health care, the mortgage interest on your home(s), cost of your au pair or nanny, etc.). No, after you take all your deductions, you have to still have at least $250,000 in taxable earnings to get the greatest benefit.
The plan I'm talking about is the one put forward by President Obama.
Now everyone is asking "WHAT??!!!"
Here's why Obama's plan provides the greatest benefit to those who have a quarter million dollars or more in taxable income:
The tax cut is a percentage on the first $250,000 of taxable income. If you have only $20,000 in taxable income, your tax break is a percentage of $20,000. If you have $250,000 or more in taxable income, you get the maximum dollar amount of tax break.
Those who argue for a tax cut on compensation for income above $250,000 are arguing for an additional tax cut that only applies to the 2% of Americans who A) receive more than that in wages and B) haven't managed to find enough tax shelters to hide it all.
I understand that times are tough, but they're not tougher for people in the upper 2% of income than they are for the rest of us.
