Debt Free- When the Bush Tax Cuts Expire - For the Rest of Us


On the expiration of the “Bush” tax cuts, the tax brackets will change as follows:
Brackets 10, 25, 28, 33 and 35 percent will be increased by 50%, 12%, 10.7%, 9.1% and 13.1% percent, respectively, to 15, 28, 31, 36 and 39.6 percent. Those of you at the bottom of the tax barrel will see a 50% tax increase. Still think that those tax cuts are strictly for the wealthy?? Well, have a nice day then. The child tax credit will be cut in half (damn those wealthy families with children) so in reality, the upper and lower classes benefited the most from the tax changes, with the lower class receiving far and away the largest benefit. Yet, we seldom hear this in our daily news osmosis. The phrase “tax cuts for the rich” has been repeated so many times that the majority of the sheeple simply believe it.

Nobody wants to comment on this TAX increase.

http://www.nytimes.com/2008/05/01/us...in&oref=slogin

Financial Facts About Barack Obama - Part 1: Letting The Bush Tax Cuts Expire | Flimjo

Expiration of Bush Tax Cuts

Currently (under the Bush tax cuts), the top income tax rate is 35 %. Under Obama, that rate would go back up to 39 %. Obama claims that this shifts the tax burden to American households that earn more than $250,000 per year . . . or, in his words, the “wealthy.”

Burden on Small Businesses, Not “Wealthy” People

But he’s wrong. This logic (i.e., shifting the tax burden to the “wealthy”) assumes, first, that people who make $250,000 are wealthy. In today’s economy of inflated real estate prices, high gas prices, and a falling dollar, $250,000 only goes so far and doesn’t even come close to equaling “wealth.”

But there’s a bigger problem with Obama’s logic. He isn’t shifting anything to the wealthy. Instead, he’s shifting the tax burden to small businesses.

Several articles, including this one, have pointed out that about two-thirds of the $700+ billion of income from small businesses in 2006 was reported by households making $250,000 per year or more. (Income for “small businesses” is primarily derived from sole proprietorships, partnerships, and S-corporations.)

Note that these are the same households (i.e., those making more than $250,000 per year) on which Obama wants to increase taxes. Thus, raising taxes on these households will effectively raise taxes on most small-business profits in America.

How High Will Taxes Be For Small Businesses?

Under President Obama, the S-corporation tax rate would rise from 35 % to 39.6 %. The tax rate for sole proprietors and general partners, however, would rise from 37.9 % to 50.3 %. (Sole proprietors and general partnerships have to pay income tax and the Medicare portion of the payroll tax.)

A tax rate of over 50 % would be the HIGHEST rate a small business has paid since before Reagan was president.

Serious Economic Consequences

If two-thirds of all small-business income is taxed at 50 %, there will be serious economic consequences, including (1) fewer businesses, (2) fewer jobs, (3) more tax evasion and tax avoidance, (4) less federal tax revenue, and, ultimately, (5) a full-blown recession.

1) Fewer Businesses

Right now, the fastest way to achieve financial freedom is by starting your own business. Under President Obama, however, a 50 % small business tax rate will discourage Americans from starting a small business or expanding or growing an existing one.

Who would want to start a business where, if you achieve any level of success, you might lose HALF of the business’s earnings to Uncle Sam?? Any reasonable person would rather remain employed (and get taxed at 20+ % or 30+ %) than start a sole proprietorship or partnership (and get taxed at a top rate of 50 %). A 50 % tax rate wipes away any financial potential of working for yourself or starting your own business.

2) Fewer Jobs

Obama’s tax increases will also reduce the number of available jobs. Small businesses create the majority of jobs in the U.S. So do the math: If fewer people start small businesses, and fewer people expand and grow their small businesses, there won’t be as many businesses (and as many growing businesses) offering jobs.

Even if you think that a sole practitioner like a doctor who makes $500,000 per year is “wealthy,” ask yourself this question: Have you ever gotten a job from a poor person? The answer, of course, is “no.” “Rich” people–or, more accurately, small and medium-sized business owners–provide jobs. If you place such an enormous tax burden on these businesses, you prohibit them from growing (or starting up in the first place) and even might cause many of them to contract to save money. And if businesses don’t get started, don’t grow, and if some have to downsize, there will be fewer and fewer jobs on the market.

This is a stunning cause-and-effect that you don’t see reported in the media or in any popular publication. Obama has stated (like every liberal) that he wants to create more jobs. Yet his own tax proposals will destroy job growth!

Think about it in real-world examples. In your town, the restaurant down the street that was about to open doesn’t. The manufacturing company that just opened a new plant decides to close it two weeks later because it lacks the funds to sustain the plant during its initial stages. The doctor who wants to leave a university to open up a private practice in the town center decides that his money can be better spent elsewhere.

These events all have one thing in common: they don’t create jobs.

3) More Tax Evasion

Tax evasion would certainly increase. If business owners have to struggle to pay Uncle Sam, a good number of them might very well try to get crafty with their tax returns. When the choice is between sustaining your livelihood (e.g., your handy man business or your moving company) or paying Uncle Sam, you can bet business owners will try to avoid paying some of their taxes.

4) Decrease in Federal Tax Revenue

Don’t pay attention to the media on this. If you have fewer businesses, fewer sole proprietors, and fewer employees (due to fewer jobs) paying taxes, and if you have an increase in tax evaders, federal tax revenue will decrease. Count on it.

5) Full-Blown Recession

If you’re keeping score at home, we have fewer businesses, fewer jobs, an increase in tax evasion, and a decrease in federal tax revenue. We’ll also have higher unemployment and less innovation, investing, and entrepreneurship. Fewer people will have money, and those who do will have less. Less money means less consumption and less disposable income to spend on products and services.

These are the classic ingredients of a recession. Obama’s tax proposals would bring this economy to halt. We’re not even close to a recession yet (i.e., the economy grew 1% last quarter, and you need two straight quarters of negative growth). If you think times are tough right now, just wait for Obama to take the helm.

That’s not change we can believe in. (It’s actually much of the same failed policies from the 1960s and 1970s.) Despite the Harvard education (which, by the way, is overrated), these cold, hard facts about Barack Obama illustrate that he doesn’t have a clue about the economy.

This is funny, perhaps it might lighten the mood.

http://farm4.static.flickr.com/3091/...e8a3dc.jpg?v=0

Sarah has got you boys scared, get used to her, she will be your next VEEP and President soon

It's scary that anyone finds this amusing. Looks can only get you so far when it comes to running the United States of America.