"In just six months, the largest tax hikes in the history of America will take effect. They will hit families and small businesses in three great waves on January 1, 2011:"
I got this fwd from an old friend, it's getting wide circulation on the right, and I just had to spend some time collecting some citations debunking it. Click the link to read it, I'm not posting it here. - td
In this undocumented blog post first published by accountant Ryan Ellis on Wednesday, July 7, 2010 at http://atr.org/six-months-untilbr-largest-tax-hikes-a5171 there are several plain mistakes, many deliberately misleading statements, and no citations or support at all. Ellis is a conservative blogger/tax accountant.
One is the claim that
>Starting in 2011,
>(next year folks), your W-2 tax form sent by your employer will be increased to
>show the
>value of whatever health insurance you are given by the company.
You will now be
>required to pay taxes on a large sum of money that you have never seen.Nah, they'll list it, but it is NOT taxable,
Factcheck.com has a direct rebuttal:
Notice the wording- "2/3's of profits will be taxed". Notice it doesn't say 2/3's of small business owners wil be taxed.
According to the Current Population Survey data, the median annual personal income of self-employed workers in 2008 was $35,357, while the median for wage and salaried workers is $35,000.Similarly, the Pew Research survey asked respondents for their overall family incomes -- a total that includes the earnings of spouses -- and found that the median family incomes of the self-employed and other workers are identical: $62,500.
The self employed are not making significantly more than other people. Likewise only a few of them would be affected by the >$250k tax hike.
and Politifact has a list evaluating various other statements about taxes on both sides of the fence
Here's one pertinent to this post that is plainly false:
"Should Democrats get their way, every income tax bracket will increase on Jan. 1, 2011. Every single one." Mike Pence
If the tax cuts were to expire with no Congressional intervention, the pre-2001 tax brackets would spring back to life. Here's how the tax brackets would look on a before-and-after basis for married couples filing jointly based on their incomes. For simplicity, we're ignoring modest adjustments for inflation. Tax brackets for other categories such as individual filers broadly follow the same pattern.
• Up to $16,750: Rises from 10 percent to 15 percent
• From $16,751 to $58,200: Stays same at 15 percent, but entire bracket pays 5 percent additional on the first $16,750
• From $58,201 to $68,000: Rises from 15 percent to 28 percent
• From $68,001 to $137,300: Rises from 25 percent to 28 percent
• From $137,301 to $209,250: Rises from 28 percent to 31 percent
• From $209,251 to $373,650: Rises from 33 percent to 36 percent
• $373,651 and up: Rises from 35 percent to 39.6 percent
So on this point, Pence is correct, assuming Congress does nothing.
• Do Democrats want every tax bracket to rise, as Pence suggests? In a word, no.
For many months, Democratic officials have consistently said that they intend to let only the tax cuts for the wealthiest individuals lapse. The cutoff they usually suggest is $200,000 for individuals and $250,000 for married couples filing jointly.
Here's a quick pair of visuals in an article by Ezra Kline at the Washington Post, but he pulls the charts from the Wall Street Journal...
This chart from the Wall Street Journal demonstrates that not only do low-, middle- and even upper-middle-class people not suffer under President Obama's proposed tax changes, they actually benefit relative to if the Bush tax cuts were extended in full:
Unfortunately, this does not include the effect of letting the Bush tax cuts expire in their entirety, which CBO projections show would deal with much of the deficit problem in the medium to long term. Luckily, the Tax Foundation has crunched those numbers as well. Here's the WSJ graph modified to include the effect of letting the tax cuts expire as planned. S = single, M = married, *E indicates the number of earners in the household, and *C indicates the number of children:
The pattern here is fairly simple.Letting all the tax cuts expire produces the highest tax burden of the three for every group except the very rich, who pay the most under Obama's plan. Below the $300,000-a-year group, the lowest burden comes from the Obama tax proposals, while above that group it comes from extending the Bush tax cuts. Extending the cuts in their entirety, then, would primarily benefit high earners, while the Obama plan both raises rates on very high earners, relative to the status quo, and reduces the burden of low- and middle-income taxpayers. (my bold - td)
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