A question about tax rates

[Ravi]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

The government logic is that it's the difference between income and at risk capital.

Income is owed as earned. Capital can be completely lost, which happens more than you realize.

The lower tax rate on Cap Gains is due to the long term nature of investments and their importance to economic growth (which enables income producing jobs).

IMO, income taxes should be low and the same flat rate for everyone, and capital gains should not be taxed. The income which produced the capital has already been taxed once. And given the way the government continues to destroy the value of the dollar, taxing gains which are often just barely keeping up with inflation (if that) is adding insult to injury.

Your body is also an instrument of investment and can be injured, lost or just worn out so that rational is meaningless.

 

[Ravi]

Because the rate of return would diminish if taxes increased, thus the incentive to invest/risk also diminishes.

So why is the rate of return being diminished by taxes for income you earn while employed fair?

 

[Ravi]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

Good question.

Why is some income taxed at 10% and some at 35%? That seems unfair to me.
What about the income that isn't taxed at all? You know, those 47% that file a return and pay nothing at all. That doesn't seem fair to me either.

Questions for another thread.

 

[Kiki Cannoli]

Because the rate of return would diminish if taxes increased, thus the incentive to invest/risk also diminishes.

So why is the rate of return being diminished by taxes for income you earn while employed fair?

It isn't.

 

[OODA_Loop]

Do not know who trust on historical tax rate numbers. Jury still out here.

End of the day...today is what really matters tho'.

 

[Ravi]

because the income that was invested has already been taxed once.

So? Why do you people keep babbling about that? Of course it's already been taxed once and it won't be taxed again. Only the profits will be taxed.

Now, moving along, where is the fairness in charging on tax rate for one type of income vs. another tax rate for another type of income?

If you invest $100 and make a 10% return in 5 years, but the inflation has been over 10% over that same period, why should the government tax your "phantom" profits which haven't even kept up with inflation?

Inflation also applies to wages, so that argument is moot.

 

[iamwhatiseem]

The top question that should be prevalent on everyone's mind:
Why is over half of all income in America not only not taxed at all - but these people have a negative tax liability - receiving money from the IRS.

False premise means no one will answer your question.

Is that so?
Then dispute my claim.
Half of Americans pay no federal income tax - Business - Personal finance - Tax Tactics - msnbc.com
51% of Americans Pay No Federal Income Taxes - Derek Thompson - Business - The Atlantic
Why do half of Americans pay no federal income tax? - CSMonitor.com
Nearly half of US households escape fed income tax - Yahoo! Finance


Idiot

 

[eflatminor]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

You're right, EVERYONE should be taxed at the same flat rate, including the nearly 1/2 of Americans that pay NO income tax currently. Again, you are absolutely right to question why income is taxed differently. It is terribly unfair.

 

[Ravi]

The top question that should be prevalent on everyone's mind:
Why is over half of all income in America not only not taxed at all - but these people have a negative tax liability - receiving money from the IRS.

False premise means no one will answer your question.

Is that so?
Then dispute my claim.
Half of Americans pay no federal income tax - Business - Personal finance - Tax Tactics - msnbc.com
51% of Americans Pay No Federal Income Taxes - Derek Thompson - Business - The Atlantic
Why do half of Americans pay no federal income tax? - CSMonitor.com
Nearly half of US households escape fed income tax - Yahoo! Finance


Idiot

Start your own thread, dipshit.

 

[Kiki Cannoli]

The top question that should be prevalent on everyone's mind:
Why is over half of all income in America not only not taxed at all - but these people have a negative tax liability - receiving money from the IRS.

False premise means no one will answer your question.

Is that so?
Then dispute my claim.
Half of Americans pay no federal income tax - Business - Personal finance - Tax Tactics - msnbc.com
51% of Americans Pay No Federal Income Taxes - Derek Thompson - Business - The Atlantic
Why do half of Americans pay no federal income tax? - CSMonitor.com
Nearly half of US households escape fed income tax - Yahoo! Finance


Idiot

From the yahoo article it states that they (the taxpayor) qualified for enough exemptions and deductions to eliminate liability. So they are wrong because they did it right?

 

[ogibillm]

The top question that should be prevalent on everyone's mind:
Why is over half of all income in America not only not taxed at all - but these people have a negative tax liability - receiving money from the IRS.

False premise means no one will answer your question.

Is that so?
Then dispute my claim.
Half of Americans pay no federal income tax - Business - Personal finance - Tax Tactics - msnbc.com
51% of Americans Pay No Federal Income Taxes - Derek Thompson - Business - The Atlantic
Why do half of Americans pay no federal income tax? - CSMonitor.com
Nearly half of US households escape fed income tax - Yahoo! Finance


Idiot

it is indeed a false premise to say that half of all income is not taxed.

 

[Care4all]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

Good question.

Why is some income taxed at 10% and some at 35%? That seems unfair to me.
What about the income that isn't taxed at all? You know, those 47% that file a return and pay nothing at all. That doesn't seem fair to me either.

do you want to pay taxes on your entire income and take no deductions that bring your tax obligation down every year?

those are the same deductions these other people take that brings them down to owing nothing in taxes.

If you don't give the personal income deductions or personal exemptions and standard deductions then YOU DO NOT get them either....MM.

 

[eliotj]

I'm with you on this. We could simply avoid all of the inbred-like fighting among Americans. JUST ATX everyone at the same rate. The more you make..the more you pay like sales tax. I didn't pay $13,000 in sales tax on my car because I couldn't afford a car like that..so I paid about $400 in sales tax. I didn't pay $35000 in income tax because I didn't earn that much money.

If you earn money from selling something for more than you paid..you should pay tax on that profit. If you WORKED and spent nothing, but received $50,000 in return then your profit is $50,000 and you pay tax on that!

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

 

[eliotj]

ya know..we live within our means..if the ONLY way we can afford that new car is through tax-deduction manipulation then maybe you should buy a "new" used car.

 

[alan1]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

Good question.

Why is some income taxed at 10% and some at 35%? That seems unfair to me.
What about the income that isn't taxed at all? You know, those 47% that file a return and pay nothing at all. That doesn't seem fair to me either.

Questions for another thread.

I've put the OP in red font to highlight the fact that it was about taxation at different rates, just as my questions were.

 

[DiamondDave]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

Good question.

Why is some income taxed at 10% and some at 35%? That seems unfair to me.
What about the income that isn't taxed at all? You know, those 47% that file a return and pay nothing at all. That doesn't seem fair to me either.

Look at that. More jealousy of the lower middle class and poor. Way to set your bar high. You jealous of the homeless too? I mean, they get out of paying income AND property taxes.

Class envy on full display.

So you will then stand for unequal treatment of others when it does not benefit you, instead of only when it does benefit you??

 

[alan1]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

Good question.

Why is some income taxed at 10% and some at 35%? That seems unfair to me.
What about the income that isn't taxed at all? You know, those 47% that file a return and pay nothing at all. That doesn't seem fair to me either.

do you want to pay taxes on your entire income and take no deductions that bring your tax obligation down every year?

those are the same deductions these other people take that brings them down to owing nothing in taxes.

If you don't give the personal income deductions or personal exemptions and standard deductions then YOU DO NOT get them either....MM.

I have no problem with every income dollar being taxed at the exact same rate for everybody. No deductions for anybody. None.

 

[thereisnospoon]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

Easy..Investment capital was already taxed when it was earned. That is whether through employment, inheritance, gambling winnings, stock dividends, etc.
The lower rate on capital gains is an incentive for people to invest rather than simply sit on their money. It's an incentive to put wealth back into the economy.
Investment in business creates jobs which in turn give workers the opportunity to spend and invest themselves.
Increase taxes and that all goes away. When the earnings and income of business owners and workers stop spending and investing because part of their income normally used for these things is taken away by government. Even the perception that taxes will be increased causes people to hunker down and slam shut their wallets.

 

[Care4all]

no individual taxes are paid on money that has already been taxed....the money that is being taxed is money that has never been taxed, the gain on investment.

there is no individual double taxation?

 

[thereisnospoon]

Why is income taxed differently and why is this not seen as an unfair situation?

For instance, if you earn a pay check or are self employed you are taxed somewhere between 10% and 35%.

Yet if you earn your income through investments you are taxed a flat 15%.

because the income that was invested has already been taxed once.

So? Why do you people keep babbling about that? Of course it's already been taxed once and it won't be taxed again. Only the profits will be taxed.

Now, moving along, where is the fairness in charging on tax rate for one type of income vs. another tax rate for another type of income?

Ok....Your initial question was fair and seemed to be intended to gather information.
This question above is asked to elicit an argument. Not going there.
The answers you received are satisfactory and sufficient to satisfy your query.
Now you are trying to start a fight. Forget it. Not playing this game.
BTW, income is taxed more than once....It's taxed when it's earned. Taxed when it's spent. Taxed when it is saved.
If one takes a dollar and spends it on certain items the effective tax can near 70%....
Let's take a cell phone owning internet using pay tv customer...
I will use my own...
Ok., My cell phone bill which includes three phones on my account.
The bill is about $180 per month....There are about $15 in taxes on that or7%.
My pay tv bill is taxed by 5% in NC and 2% to federal.
State income tax 5%. Sales tax 8%....federal gas tax 18 cents per gallon or at $3.50 per gallon or 5%..State gas tax is 32.5 cents per gallon or about 9%...
So lets add those up.....
Federal income tax 28%+7%+5%+2%+5%+9%.....56%..My income is basically taxed at 56%!!!! And I am not paying my fair share?!!!!! Please....