TPC: Romney Plan Would Cut Taxes for Rich, Raise Taxes on Middle Class and Poor. (Tax Prof). Some news, folks: if spending doesn’t come down drastically, taxes are going up for the middle class and the poor anyway. If you raised the rates on “the rich” to 100%, it still wouldn’t cover what the government is spending now.
How Did the Tax Code Get So Progressive? (William McBride, Tax Policy Blog) talks about the TPC study:
The main thing missing here is the context of our current federal income tax code. Imagine a society with 5 people, where the two richest people pay all the taxes, the middle person pays nothing, and the two poorest people actually have a negative tax rate, meaning the rich are paying them through the tax code. Then any cut in the tax rate will disproportionately benefit the rich guys. This is the federal income tax code, in a nutshell. According to the CBO, the top 20 percent of households pays 94 percent of federal income taxes. The bottom 40 percent actually have a negative income tax rate, and the middle quintile pays close to zero.
If “the rich” pay all the taxes, then of course tax cuts will disproportionally benefit them.
We’ve cut government spending to the bone! The bone just seems to keep getting bigger (Donald Marron, TaxVox)
If you look at the two lines on the chart, you can see that spending on “goods and services” isn’t going up much. That means they’re just taking a lot more of your money to give to their friends.
Still no media coverage of the last film tax credit trial. Seeing that the Des Moines Register just jacked up home delivery for my usually-unread papers to $25 per month, it would be nice if they actually covered something. Well, there’s this: Celeb tweets to Gabby Douglas. Of course, they all missed the real story when the film tax credit was enacted, so at least they’re consistent.
In case you haven’t heard, Iowans, the Annual sales tax holiday is Friday and Saturday (Dar Danielson, Radio Iowa). It applies for clothes and shoes. Jason Dinesen reminds us about Back to School Supplies and the Iowa Tuition and Textbook Credit.
Big charitable contribution, no deduction? My new post at IowaBiz.com covers traps in appreciated property charitable contributions.
Phil Hodgen is back from a scouting trip to Quetico Provincial Park, the Canadian side of the Boundary Waters wilderness, with Basis step-up on assets inherited from nonresident.
Sort-of related: more pictures from my recent Boundary Waters scout trip.
Peter Reilly, IRA Rollovers – Let’s Be Careful Out There
Patrick Temple-West, Essential reading: Payroll tax cut on track to quietly expire (Tax Break)
Trish McIntire, Drought, Farms and Taxes.
Kay Bell, Tax moves to make in August 2012
The New Jersey Tax Guy is fleeing to Pennsylvania. Good luck with the move, Robert!
Asking the tough questions: Why Am I Paying for a Prancing Horse? (Christopher Bergin, Tax.com) and Should Our Olympic Heroes Pay Tax on Their Winnings? (Anthony Nitti)
Tags: TaxProf, Kay Bell, Tax Policy Blog, iowabiz.com, Robert D Flach, TaxGrrrl, Tax Policy Center, Radio Iowa, Going Concern, State 29, Phil Hodgen, Dar Danielson, Peter Reilly, William McBride, Jason Dinesen, Anthony Nitti, Chrstopher Bergin