The 69th Tax Carnival is up - just in time for April 15!
It has a bunch of good, informative blog posts on taxation.
It has a bunch of good, informative blog posts on taxation.
Showing posts with label Taxes. Show all posts
Showing posts with label Taxes. Show all posts
Monday, 12 April 2010
Wednesday, 7 April 2010
Almost 1/2 of U.S. Households Don't Pay Federal Income Tax
Posted on 15:47 by Unknown
| According to this article: http://news.yahoo.com/s/ap/20100407/ap_on_bi_ge/us_no_taxes About 47% of all households won't pay income tax for 2009. Either they did not make enough, or they had enough credits, deductions, and exemptions. The top 10% pay about 73% of the Federal income tax. The bottom 40% actually make a profit (they get more in credits then they owe). I don't think this is a good idea. I think everyone should pay something. Then, the tax rate could be lower because there will be a bigger number of payers. More importantly, there is currently no incentive for 1/2 the people to vote against politicians who waste money. Also, I recognize that many big corporations also escape taxes. I realize that they enjoy some of the biggest loopholes. What if we got rid of all loopholes - for rich and poor alike? No exemptions, deductions, or credits. Instead, everyone pays a single, low rate. Let's say it's 10%: Then someone making $10,000 a year pays $1,000 while someone making $1,000,000 pays $100,000. You might argue this is regressive and shifts the burden away from the higher earners. The traditional argument against a single flat rate is that a lower-income worker pays a higher percent of his income in essential expenses. But high earners have demonstrated creativity and achieved success. They are the ones driving human progress and job creation. Why should we penalize them for their achievements? I recognize that supply-side, or "trickle-down", economics is controversial. But the fact is that life doesn't happen in a vacuum. Lower income workers will have to pay more but a flat tax should compensate them somewhat by spurring job growth. Also, maybe it's good that lower-income workers feel some pain from a "regressive" tax. A fix is only as far away as the next election. They can choose to vote for small-government candidates. What are your thoughts? I welcome comments. |
Tuesday, 9 February 2010
Free Ebook: Capital Gains Tax Tips for Traders and Investors
Posted on 13:00 by Unknown
Stocks, mutual funds, and exchange traded funds (ETFs) bought and sold outside of qualified accounts (i.e. IRAs, 401Ks, etc.) may trigger capital gains taxes.
Many people are more familiar with paying taxes based on w-2's from their regular jobs. The concepts of calculating a cost basis and figuring out capital gains or losses are a bit confusing.
My own father had trouble in this area a couple of years ago. Luckily, the IRS agent was very helpful and patient with him.
I have created a free ebook which provides basic information about capital gains and taxes for traders and investors (with the understanding that I am not a financial planner or accountant - this is just information, not advice).
You can download it from this link http://www.box.net/shared/9did0qmmqz
Many people are more familiar with paying taxes based on w-2's from their regular jobs. The concepts of calculating a cost basis and figuring out capital gains or losses are a bit confusing.
My own father had trouble in this area a couple of years ago. Luckily, the IRS agent was very helpful and patient with him.
I have created a free ebook which provides basic information about capital gains and taxes for traders and investors (with the understanding that I am not a financial planner or accountant - this is just information, not advice).
You can download it from this link http://www.box.net/shared/9did0qmmqz
Wednesday, 22 April 2009
Illinois Governor Tries To Eliminate Flat Income Tax
Posted on 15:10 by Unknown
My state of Illinois is currently experiencing a fiscal crisis, and our new governor, Pat Quinn, wants to raise income taxes(Of course, a lot of people - including myself - would rather see him cut waste and expenses first).
His ideal scenario would be to replace our flat state income tax with a progressive tax (a tax with multiple rates - like the Federal income tax) so that he can shift more of the increase towards the "rich".
The problem is that a progressive income tax is not permitted by the Illinois constitution.
To get around this, he is trying to create a "de facto progressive" tax by increasing the rate 50% (from 3% to 4.5%), while tripling the exemption.
Currently, out of the seven states with flat state income taxes, Illinois has the lowest rate at 3%. A 4.5% rate would put us in the middle.
The IL flat income tax means that everyone, no matter what their income level, has to pay 3% of their income in taxes. There are no deductions - only a $2000 exemption per person. So, a family of four (husband, wife, 2 children) would have an $8,000 total exemption.
This makes filling out the return easy: just copy the adjusted gross income (AGI) amount from your Federal return, apply the exemption, and then multiply by 3%.
Now, it will still be just as easy to fill out the return (because its still a flat tax), but a family of four would now have a $24,000 exemption, and would be taxed 4.5% on anything over that.
If the family of four makes $50,000, they would pay $1260 under the current rate. Under the new rate/exemption, they would pay $1170 (about 7% less).
But, if the same family of four makes $100,000, their taxes would go up 24% (from $2760 to $3420).
His ideal scenario would be to replace our flat state income tax with a progressive tax (a tax with multiple rates - like the Federal income tax) so that he can shift more of the increase towards the "rich".
The problem is that a progressive income tax is not permitted by the Illinois constitution.
To get around this, he is trying to create a "de facto progressive" tax by increasing the rate 50% (from 3% to 4.5%), while tripling the exemption.
Currently, out of the seven states with flat state income taxes, Illinois has the lowest rate at 3%. A 4.5% rate would put us in the middle.
The IL flat income tax means that everyone, no matter what their income level, has to pay 3% of their income in taxes. There are no deductions - only a $2000 exemption per person. So, a family of four (husband, wife, 2 children) would have an $8,000 total exemption.
This makes filling out the return easy: just copy the adjusted gross income (AGI) amount from your Federal return, apply the exemption, and then multiply by 3%.
Now, it will still be just as easy to fill out the return (because its still a flat tax), but a family of four would now have a $24,000 exemption, and would be taxed 4.5% on anything over that.
If the family of four makes $50,000, they would pay $1260 under the current rate. Under the new rate/exemption, they would pay $1170 (about 7% less).
But, if the same family of four makes $100,000, their taxes would go up 24% (from $2760 to $3420).
Thursday, 22 January 2009
Obama's Nominee for Treasury Secretary Misfiled His Taxes Using TurboTax
Posted on 11:24 by Unknown
| Timothy Geithner, president of the New York Federal Reserve, is Obama's choice for Treasury Secretary - which oversees the IRS. Both Republican and Democratic congressmen like his background but, he has been put in the hot seat because he messed up his taxes several years ago, and had to pay penalties. The interesting thing is that, even though he is a financial big shot, he did his taxes himself, using off-the-shelf TurboTax. Personally, I think messing up on your taxes and then overseeing the IRS can be a good thing, if it motivates him to push for simplifying taxes. |
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