Tax question re: "over $250K..."

[SHRED]

A little clarification needed.
When the administration talks about the taxes on those individulas making over $250K are they taking about income above that?
In other words say you make $500K; is up to $250K taxed at the lower rate and then anything over $250K subject to the slightly higher rates?

[rucky]

1. You are correct.

[Richardo]

2. Yes.

The higher rate applies only on the incremental income over $250K.

[aquart]

3. Thank you for your pre-election concern.

[MindPilot]

4. Yes and that is after deductions.

So if I understand this correctly, say you make $300,000 and have $49,000 worth of deductions, then you pay the higher rate on that last $1000.

The reality is that someone who ends up with taxable income over $250,000 is already making way more than that and probably they are not making that money from regular taxable wages; it's coming from other sources like capital gains.

An increase on people making over $250k affects a very small percentage of the population.

[safeinOhio]

6. Billionaires pay the same rate I do

on their first 33 grand, what I make. That is if their income is "earned" income. For most it is "unearned", meaning they only pay 15%.

[Warpy]

5. You are correct, which is why all the wailing and gnashing of teeth

in the upper middle class is just so much proof of ignorance and brainwashing by right wing media.

A family hauling in $300,000/year will notice only a few dollars change over this year. A family hauling in $1,000,000/year will notice a bigger change but will still not hear the wolf at the door. Plutocrats looting many millions of dollars a year out of corporations will feel the biggest bite.

If Stupid's tax cuts are all allowed to expire, though, we'll all feel the bite. My own taxes will go up $800/year. I'm not bitching about that, I can afford it and I'm grateful to have that much coming in. However, families with children will be badly hurt since their tax cuts allowed them to stay even with inflation in a decade of flat wages. It will be worth it to see the capital gains rate go back up and bite hedge fund managers in their corporate asses.

The tax I'd really like to see is a per transaction tax on Wall Street, both in commodities and equities. Five cents a trade is nothing to thee and me or any other prudent investor, but it will both raise huge amounts of revenue and put the kibosh on high frequency trading, that computer generated stuff that is diddling the market beyond all recognition.

[HillbillyBob]

10. I have no more patience for the f in whiners

We have watched our household income go from almost 110g to 30 since 2002 and my partner is doing the same job (not at the same place ) as he was doing for 80g and my income is now 10g from 30 because I am disabled.
I have not a damn bit of sympathy they can f off as far as I am concerned ..Im really really tired of it. We have to have a new roof and a new motor for my truck and I can't even afford it.

We hve cut our power bills by 3/4 because we cannot afford it other wise, we plan to go off grid. We are warmer and not sitting in the dark and all my projects cost about 50$, but its getting harder and harder to break out 50 or 100 for improvments when our income goes down every fucking six months because blue cross keeps upping the insurance on my partner and cutting what they fucking cover.

WE out here are getting very angry and very fed up. No teabagger here I live in the real world.

[Warpy]

11. We're all fed up

I don't know a single person out in the real world who isn't angry about how things are going and with good reason. The Democrats have managed to connect the dots. The teabaggers are still relying on corporate sponsored pundits to tell them who to be mad at.

This is the screwiest election season I've ever seen. As I said six months ago, the only prediction I'm making is that both sides are going to be handed some surprises. That hasn't changed.

[Lydia Leftcoast]

7. Yes, most people don't understand MARGINAL rates

They wail about how "it wouldn't be fair to take 90% of a rich person's income," but nobody would have 90% of their income taken.

[Xenotime]

8. And people over $250k should be able to afford it.

They should be taxed at much higher rates.

[KharmaTrain]

9. Most Still Won't Pay A Dime...

My bets are the smart books out there have made sure their clients took off plenty in losses...srite downs and overall paper losses that are applied to the bottom line...thus they always find a way to zero it out.

You are correct about the new rules...the first $250k are taxed at a lower rate, it's above that where the rates return to 2000...and even then, the bite is less the more you make. Be assured that a person paying 15% on $50k is still going to feel the pinch far worse than someone who is earning 500k a year and paying 30%. It's the greed...that's all that matters in the US today.

[One_Life_To_Give]

12. Marginal Rate on "Adjusted Gross Income" not Cap gains etc.

It's a progressive tax system for Adjusted Gross Income which in itself has exemptions for certain amounts of income per number of dependents, blind?, and over 65? So on the first 15k you may pay zero, 10% on the 15,001 thru 25,000 dollar, 15% on the 25,001 thru...

But not all money coming in is Income and counted towards the Adjusted Gross Income. Capital Gains are counted separately and taxed at a flat rate. Although again there are certain exclusions which may apply.