Death & Taxes

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    Posted: 22 February 2012 01:14 PM #46

    ChasMac77 - 22 February 2012 01:22 PM

    Consumers still fretting the economy. Despite recent signs of improvement in the U.S. economy, more consumers feel financially insecure than they did a year ago, largely because of their lack of savings to cushion a job loss or other problems, according to a Bankrate.com poll. Just 54% of consumers have more emergency savings than credit card debt, the survey finds.

    I know, let’s tax them some more and give more tax breaks to the rich folks. That’ll do the trick! Talk about stupid (to quote Gregg).

    As income inequality grows, the louder the complaints from the top.

    Ah, the “income inequality” canard. When has there even been income equality, except in places like Cuba where everyone is poor? Just because one guy is rich, isn’t why another guy is poor. Now that’s stupid, to quote ChasMac. I mean, how gawddamn irrelevant. How does Buffett making a billion affect Joe Sixpack? You don’t help Peter by robbing Paul. You lift everyone up.

    Let’s hear you defend this one, ChasMac, with Apple about to announce a dividend:

    Obama to triple dividend taxes

    And here’s one for you:

    50p tax UK rate ‘failing to boost revenues?
    The amount of income tax paid fell sharply last month in the first formal indication that the new 50p higher rate is not raising the expected amount of revenue.

    Of course, Obama said he doesn’t care if higher rates yield less revenue, he still wants to steal more money in the name of “fairness.”

    Chart of the Week: Nearly Half of All Americans Don?t Pay Income Taxes

    No country can work with half its people not paying taxes. We are doomed.

    And finally, from our hopefully next vice president,

    Christie To Warren Buffett: “Just Write A Check And Shut Up”

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    Posted: 22 February 2012 01:24 PM #47

    JDSoCal - 22 February 2012 05:14 PM

    You don’t help Peter by robbing Paul. You lift everyone up.

    This should be the goal.  Unfortunately, it seems politicians are running out of tricks to do so and are resorting to the short-term politically friendly “rob the rich to give to the poor” technique.

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  • Posted: 22 February 2012 01:56 PM #48

    firestorm - 22 February 2012 03:37 AM
    lovemyipad - 22 February 2012 02:03 AM

    Try an expat assignment in Canada.  Then see what you think about US taxes. :D

    I don’t see large numbers of Canadians sneaking across the border in order to make a better life in America, or even protesting in large numbers that they are Taxed Enough Already.  They enjoy longer lifespans, better average health care, a stronger economy, better roads and highways, better maintained national parks, and a lot more.  It is one of the best countries to live in in the world, and taxes help maintain that quality of life.

    This seems to me to be the old straw man component in attacking an opposing position. If this is true wouldn’t Belgium have the best living conditions in the world? (tax rate in 2005 of about 57%) Wouldn’t the Czech Republic or even the Slovak Republic have better living conditions than Canada. Taxes are necessary and I believe the rich should should pay more taxes than the poor (if for no other reason than they can) but I think it should be in the form of a consumption tax such as the Fair Tax. The rich would be far more likely to pay more taxes and they would be doing it voluntarily under such a plan. Funny that Buffet doesn’t support it since he is so concerned about paying his fair share. I can assure Gov Christie that Buffet won’t shut up and write the government a check because this issue has never been about fairness it is about control and vote buying.

         
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    Posted: 22 February 2012 02:12 PM #49

    There was a time, not so long ago, when middle and lower class Americans were paid a reasonable wage.  Back in 1973, when I worked as a summer forest firefighter for the US Forest Service, I was paid $4.02 per hour for what was basically unskilled labor.  That translates, accounting for inflation, to $20.52 per hour in today’s wages.  It was enough to live on at the time, and I was able to save a lot of money for grad school.

    The world has changed immensely since 1973.  Reaganomics hit with full force, and has not trickled down for the working poor.  Globalization allowed companies to outsource much labor.  Ayn Rand selfishness became the new religion for the right-wing.  Conservatives continued (as they always have) to despise unions, but were able to translate this contempt into public policy. The simpleton notion of the Laffer Curve held sway among supposed conservative intellectuals.

    There have been some good books and articles lately that trace these economic and other societal changes to a deterioration of the values and lives of the marginalized lower classes in America.  It used to be that the working poor had values not all that different from the middle class, but now their world has changed dramatically, with Meth addictions, high school dropout rates rising, out of marriage births rising dramatically, an abandonment of marriage, and loss of religion.

    I place a lot of the blame for the deterioration of American values squarely on the economic policies of the right-wing.  Things will get a lot worse in America if these values cannot be restored.  People need hope.  I would love to see free higher education in America, like they had in California before Proposition 13 brought an end to the economic miracle that was California.

    [ Edited: 22 February 2012 06:37 PM by lovemyipad ]      
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    Posted: 22 February 2012 02:21 PM #50

    lovemyipad - 22 February 2012 02:03 AM

    Try an expat assignment in Canada.  Then see what you think about US taxes. :D

    Actually, Canada has a lower corporate (just lowered to 15% in 2012!) and personal tax rate (29%), and offers dividend tax credits. Also, Canada has an effective rate of 21.50% for cap gains, better for options traders than the US’s short-term 35%.

    Sure, there’s a VAT, but that is far less onerous to the investor class, and no province has California’s added 11% top rate (i.e., I’ll take Canada’s VAT over California’s income tax, especially considering LA’s 8.75% sales tax).

    Canada’s regulatory burdens have dropped too, thanks to the conservative Harper government.

    Accordingly, The Heritage Foundation continues to rank Canada ahead of the US in its economic freedom index.

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  • Posted: 22 February 2012 02:33 PM #51

    firestorm - 22 February 2012 03:37 AM
    lovemyipad - 22 February 2012 02:03 AM

    Try an expat assignment in Canada.  Then see what you think about US taxes. :D

    I don’t see large numbers of Canadians sneaking across the border in order to make a better life in America, or even protesting in large numbers that they are Taxed Enough Already.  They enjoy longer lifespans, better average health care, a stronger economy, better roads and highways, better maintained national parks, and a lot more.  It is one of the best countries to live in in the world, and taxes help maintain that quality of life.

    And they recently pulled back from bankruptcy by going on an austerity program.

    Taxes aren’t the issue.  It’s the inequality of how taxes are paid, and the failure to balance the budget.  If ANY household ran its fianc?s the way the US government does, it would go broke inside of a year.  So why do we allow our government to run itself that way?

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    Posted: 22 February 2012 02:43 PM #52

    Gregg Thurman - 22 February 2012 06:33 PM
    firestorm - 22 February 2012 03:37 AM
    lovemyipad - 22 February 2012 02:03 AM

    Try an expat assignment in Canada.  Then see what you think about US taxes. :D

    I don’t see large numbers of Canadians sneaking across the border in order to make a better life in America, or even protesting in large numbers that they are Taxed Enough Already.  They enjoy longer lifespans, better average health care, a stronger economy, better roads and highways, better maintained national parks, and a lot more.  It is one of the best countries to live in in the world, and taxes help maintain that quality of life.

    And they recently pulled back from bankruptcy by going on an austerity program.

    Taxes aren’t the issue.  It’s the inequality of how taxes are paid, and the failure to balance the budget.  If ANY household ran its fianc?s the way the US government does, it would go broke inside of a year.  So why do we allow our government to run itself that way?

    I agree that we cannot continue to run huge deficits (more than half of which is attributable to Republican administrations).  We need to raise taxes to approach solvency.  And we need to dramatically cut the military so that we CANNOT get entangled in stupid wars; cut federal employee pay; and eliminate using the tax code to reward favored industries (oil and mining, for example).

         
  • Posted: 22 February 2012 02:45 PM #53

    Platon - 22 February 2012 05:56 PM

    I think it should be in the form of a consumption tax such as the Fair Tax.

    ...this issue has never been about fairness, it is about control and vote buying.

    Oh my god, YES

    The benefits of changing our tax system from taxing production, to taxing consumption are enormous.  Its what gives are Asian competitors such a price advantage over US products.  That advantage is not cheap labor.  That’s a red herring thrown up by unions and the left.

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  • Posted: 22 February 2012 04:49 PM #54

    Anyone considering relocating in retirement?  It is a huge decision.  What are all the considerations one must be aware of with relocating to another state or abroad? 

    Roni, you have plans to relocate abroad.  How did you come to that decision?  What are the advantages?

    Thanks!

         
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    Posted: 22 February 2012 05:02 PM #55

    President Obama’s 2013 budget is the gift that keeps on giving?to government. One buried surprise is his proposal to triple the tax rate on corporate dividends, which believe it or not is higher than in his previous budgets.

    Mr. Obama is proposing to raise the dividend tax rate to the higher personal income tax rate of 39.6% that will kick in next year. Add in the planned phase-out of deductions and exemptions, and the rate hits 41%. Then add the 3.8% investment tax surcharge in ObamaCare, and the new dividend tax rate in 2013 would be 44.8%?nearly three times today’s 15% rate.

    Keep in mind that dividends are paid to shareholders only after the corporation pays taxes on its profits. So assuming a maximum 35% corporate tax rate and a 44.8% dividend tax, the total tax on corporate earnings passed through as dividends would be 64.1%.

    More at the following link:

    http://online.wsj.com/article/SB10001424052970204880404577225493025537660.html?mod=WSJ_hp_LEFTTopStories

    With this tax wealth creation will become increasingly difficult since the most reliable way to build investment wealth by young and middle-aged people is by index investing in companies that pay dividends. Moreover, those on fixed incomes often receive a sizable portion of their income from dividends, the increased taxes would cut the quality of their retirement. Retirees already face mandatory required distributions (MRDs) which increasing forces retired persons to pull out money from their IRAs so as to be taxed as regular income even as they struggle against inflation.

    In less than one day there are already 658 comments on the WSJ article. As one disgruntled reader said, “Tell that to my 74 year old mother. There’s almost no safe way for her to even keep up with inflation on her retirement savings.”

    Not only would the increased tax hit current retirees hard, if the pensionless Generations X and Y cannot build a retirement savings, who will pay for their retirement when they are too old to work?

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    Posted: 22 February 2012 05:18 PM #56

    alice - 22 February 2012 08:49 PM

    Anyone considering relocating in retirement?  It is a huge decision.  What are all the considerations one must be aware of with relocating to another state or abroad? 

    Roni, you have plans to relocate abroad.  How did you come to that decision?  What are the advantages?

    Thanks!

    I’m going to relocate from Washington State to my native Michigan in about a year and a half, and have already bought a nice house there, thanks to Apple.  Many factors in deciding to relocate are intensely personal, and should go into the equation for everyone.  My wife and I still have family in Michigan, and we love the natural environment there. In addition, the constant winter rains of Western Washington can drain the spirit (almost as much as fighting with the righties here, LMFAO!).

    Another consideration is social and political: can you live with the predominant values of a place?  For me, western Washington State has been a reasonably good fit.  Seattle itself is far to the left of me (the statue of Lenin in the Fremont neighborhood is a light-hearted example), but at least there isn’t a knee-jerk negative reaction to traditionally centrist American ideas. Michigan is more conservative, and the rural neighborhood to which I am moving is largely Republican, but more in the moderate Republican vein.  I could not happily move to Arizona or Alabama, where the dominant culture would be alien and far too conservative for my values.

    Economics is, of course, a dominant consideration.  Taxes in Michigan will be roughly the same for me, at least I think so.  I’ll be living in a rural area, where the cost of getting work done on the house will be far below the prices I pay in WA.  Summer produce is better in Michigan, and they grow good apples ... not like the insipid fruits of WA State.

    I like rural and small town more than cities, so I won’t miss Seattle all that much.  Yes, the food is better in Seattle for dining out, but I don’t care about that.

    Another option is, if your budget allows, to live in two places.  One well-known photographer from Toronto spends winters in Mexico; I think he has found the contrast in places enriching.

    To sum up, you need to examine what you like, what your values are, how much money you have, and what weather you like.  All those go into the mix.

    Good luck!

    [ Edited: 22 February 2012 06:36 PM by lovemyipad ]      
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    Posted: 22 February 2012 06:24 PM #57

    A little housekeeping…  I cleaned up this thread.  To the extent we can have mutually respectful discussion/ debate without flaming, the thread will remain open.  Please—I know it’s difficult, but please, nonetheless—try to attack the ideas, not the parties, not each other.  Thank you.

    [ Edited: 22 February 2012 06:29 PM by lovemyipad ]      
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    Posted: 22 February 2012 06:34 PM #58

    Good luck with that.

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    Posted: 22 February 2012 06:35 PM #59

    Let’s see how long I last. wink

         
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    Posted: 22 February 2012 07:07 PM #60

    Apparently fact:  Current tax policy will drive up dividend taxation.

    Theory:  An Apple exec or two claimed “we’re not economists” but I’d be surprised if they didn’t have ten hidden amongst the employees.  Since Apple has to be aware of policy changes, you’d think the dividend possibility is comparatively distant right now.

    I wouldn’t be surprised if Apple does nothing at all this year aside from repurchase or split.

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