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You don't get back your FICA. It's a transfer payment, just as any other social program is a transfer payment. It's taxing 1 person in order to fund another. and like most federal social programs, the transfer occurs via a tax on income.
It is NOT like a transfer payment, as with others you do not get a tangible benefit back. For SS you are paying in and getting paid back at a later date, period.
No, you're not. You may or may not fall on the other side of that transfer payment at a later date, but you have no guaranteed right to that future payment or future income stream.
It is not THE Federal Income Tax, which is the largest source of revenue for the Federal Government. You also ignored my question. On this tax, how is the amount paid based on income bracket broken down?
Is there a large portion of the population that does not pay any of this Tax?
It is a federal tax on income. Any person who has a job pays it.
The amount paid by income bracket isn't relevant, but the fact is that the people paying the highest percentage of federal income FICA taxes are those making at or below the cap. Someone making 10,000 pays 7.65%. Someone making 105K pays 7.65%.
Someone making 1.05M pays .765%
However a small business owner pays 7.65% of what his employees earn even when he makes little or no money. That is a true regressive income tax. My business FICA tax rate was over 300% in 2001. That means I paid 3 times my business income in just that set of taxes.
What's the tax rate of $75,000 in taxes on a loss of $200,000 (my 2007 results)?
It is NOT like a transfer payment, as with others you do not get a tangible benefit back. For SS you are paying in and getting paid back at a later date, period.
No, you're not. You may or may not fall on the other side of that transfer payment at a later date, but you have no guaranteed right to that future payment or future income stream.
Are you kidding me? The whole point of social security is that you pay now, and get basically a government pension, funded by your payments later. That is the compact given by the social security law.
You are paying a specific amount to a specific fund to recieve a specifc beneift at a later date.
It is NOT like a transfer payment, as with others you do not get a tangible benefit back. For SS you are paying in and getting paid back at a later date, period.
No, you're not. You may or may not fall on the other side of that transfer payment at a later date, but you have no guaranteed right to that future payment or future income stream.
Are you kidding me? The whole point of social security is that you pay now, and get basically a government pension, funded by your payments later. That is the compact given by the social security law.
No, you are paying a specific amount into the general fund so that current recipients can receive a benefit that congress grants them. You have no claim on future revenues. None.You are paying a specific amount to a specific fund to recieve a specifc beneift at a later date.
No, you're not. You may or may not fall on the other side of that transfer payment at a later date, but you have no guaranteed right to that future payment or future income stream.
Are you kidding me? The whole point of social security is that you pay now, and get basically a government pension, funded by your payments later. That is the compact given by the social security law.
No, that is not the compact given by social security law. There is no such compact. You have zero right to future social security payments. None. Zero.
You may or may not gain access to those future revenues, but there is no contract or compact that guarantees it to you. Your access to those funds could be cut off completely and entirely with a single vote in congress tomorrow - and you would have zero legal recourse.
if, on the other hand, the same happened to your 401K or your IRA, you would have legal recourse.
No, you are paying a specific amount into the general fund so that current recipients can receive a benefit that congress grants them. You have no claim on future revenues. None.You are paying a specific amount to a specific fund to recieve a specifc beneift at a later date.
No, you're not. You may or may not fall on the other side of that transfer payment at a later date, but you have no guaranteed right to that future payment or future income stream.
Are you kidding me? The whole point of social security is that you pay now, and get basically a government pension, funded by your payments later. That is the compact given by the social security law.
You are paying a specific amount to a specific fund to recieve a specifc beneift at a later date.
but 8537 is working off an assumption...and a valid one...
He is saying it is not GUARANTEED that you will get that money.
It is only said that you will....but with no guaranteee...
And he is correct.
It is a federal tax on income. Any person who has a job pays it.
The amount paid by income bracket isn't relevant, but the fact is that the people paying the highest percentage of federal income FICA taxes are those making at or below the cap. Someone making 10,000 pays 7.65%. Someone making 105K pays 7.65%.
Someone making 1.05M pays .765%
However a small business owner pays 7.65% of what his employees earn even when he makes little or no money. That is a true regressive income tax. My business FICA tax rate was over 300% in 2001. That means I paid 3 times my business income in just that set of taxes.
What's the tax rate of $75,000 in taxes on a loss of $200,000 (my 2007 results)?
That's an interesting comparison. As you know, the FICA tax rate is not related to your business income. It's related to the wages you pay.
Still, you make a good point about how regressive the tax can be when speaking of your business's overall taxes.
In the current world of litigation I think there would be one hell of a case if they decided to cut the system.
I don't understand your question. The people who pay the federal income tax excluding FICA are those people whose income is high enough and deductions low enough to have a positive AGI. From there, it's a progressive tax based on that AGI. Higher AGI's pay a higher tax on labor income.and you still didnt answer my question about the Actual FEDERAL INCOME TAX and who pays how much of a percentage of it.
No, you're not. You may or may not fall on the other side of that transfer payment at a later date, but you have no guaranteed right to that future payment or future income stream.
Are you kidding me? The whole point of social security is that you pay now, and get basically a government pension, funded by your payments later. That is the compact given by the social security law.
No, that is not the compact given by social security law. There is no such compact. You have zero right to future social security payments. None. Zero.
You may or may not gain access to those future revenues, but there is no contract or compact that guarantees it to you. Your access to those funds could be cut off completely and entirely with a single vote in congress tomorrow - and you would have zero legal recourse.
if, on the other hand, the same happened to your 401K or your IRA, you would have legal recourse.
No, you are paying a specific amount into the general fund so that current recipients can receive a benefit that congress grants them. You have no claim on future revenues. None.You are paying a specific amount to a specific fund to recieve a specifc beneift at a later date.
In the current world of litigation I think there would be one hell of a case if they decided to cut the system.
Congress has reduced social security benefits more than once in the past, and no lawsuit or litigation has succeeded - and that's because there is no contract or right to any future revenues. There simply isn't.
I don't understand your question. The people who pay the federal income tax excluding FICA are those people whose income is high enough and deductions low enough to have a positive AGI. From there, it's a progressive tax based on that AGI. Higher AGI's pay a higher tax on labor income.and you still didnt answer my question about the Actual FEDERAL INCOME TAX and who pays how much of a percentage of it.
FICA is paid by everyone with a job, and it's a regressive tax paid only on the first 100K+ of income. People who earn more than the cap pay at a lower rate.
FICA is a slightly smaller portion of total federal revenues than the federal income tax not associated with FICA.
However a small business owner pays 7.65% of what his employees earn even when he makes little or no money. That is a true regressive income tax. My business FICA tax rate was over 300% in 2001. That means I paid 3 times my business income in just that set of taxes.
What's the tax rate of $75,000 in taxes on a loss of $200,000 (my 2007 results)?
That's an interesting comparison. As you know, the FICA tax rate is not related to your business income. It's related to the wages you pay.
Correct. But it is also not an income tax on the employee since they are not paying it.
Are you kidding me? The whole point of social security is that you pay now, and get basically a government pension, funded by your payments later. That is the compact given by the social security law.
No, that is not the compact given by social security law. There is no such compact. You have zero right to future social security payments. None. Zero.
You may or may not gain access to those future revenues, but there is no contract or compact that guarantees it to you. Your access to those funds could be cut off completely and entirely with a single vote in congress tomorrow - and you would have zero legal recourse.
if, on the other hand, the same happened to your 401K or your IRA, you would have legal recourse.
No, you are paying a specific amount into the general fund so that current recipients can receive a benefit that congress grants them. You have no claim on future revenues. None.You are paying a specific amount to a specific fund to recieve a specifc beneift at a later date.
So you're saying that structurally Social Security is not an insurance policy nor an investment plan correct?
My question is: Are there people who pay no 1040 Federal Income Tax?
That's an interesting comparison. As you know, the FICA tax rate is not related to your business income. It's related to the wages you pay.
Correct. But it is also not an income tax on the employee since they are not paying it.
Discounting any tax incidence, you are correct and my previous replies assumed otherwise (incorrectly). It is, in a very real sense, a tax on businesses.
I appreciate that perspective and it causes me to think of it a bit differently.
No, that is not the compact given by social security law. There is no such compact. You have zero right to future social security payments. None. Zero.
You may or may not gain access to those future revenues, but there is no contract or compact that guarantees it to you. Your access to those funds could be cut off completely and entirely with a single vote in congress tomorrow - and you would have zero legal recourse.
if, on the other hand, the same happened to your 401K or your IRA, you would have legal recourse.
No, you are paying a specific amount into the general fund so that current recipients can receive a benefit that congress grants them. You have no claim on future revenues. None.
So you're saying that structurally Social Security is not an insurance policy nor an investment plan correct?
structurally, it is run a bit like an insurance company. Revenues enter the system and some of those are used to pay current claims. any revenues remaining after paying current claims are invested.
In a traditional insurance company, current payees have a contractual right to those invested funds in future periods. Social Security is a bit different because:
1. By law, it must invest those funds in special treasury obligations. What makes those obligations "special" is that Congress is under no obligation to pay them.
Now isn't that special?
2. By law, no current payee has any contractual right to future revenues.
(as for investment plans, no - it's nothing at all like a personal investment plan)
The problem is that the language we use to talk about SS is quite disassociated from what SS actually is.
My question is: Are there people who pay no 1040 Federal Income Tax?
Of course! There are millions of people who pay no 1040 Federal income tax (people whose AGI is negative, for example)
There are also millions of people who pay no FICA. (people who live off investment income, for example)
And millions of people who pay no amount of a variety of other taxes.
My question is: Are there people who pay no 1040 Federal Income Tax?
Of course! There are millions of people who pay no 1040 Federal income tax (people whose AGI is negative, for example)
There are also millions of people who pay no FICA. (people who live off investment income, for example)
And millions of people who pay no amount of a variety of other taxes.
Ok, now I'm trying to remember what the hell the original argument was about.
Indeed. Whatever the original argument was about, it's an interesting discussion.So, if you treat FICA as federal tax, then indeed, the numbers on who pays what percentage of income taxes is now skewed more towards lower incomes.
As with most numbers, its amazing how you can play around with them.
Lets pay a flat tax, to treat all equal.
That's not equal by a long shot.
That's just simple.
VASTLY different.
So you're saying that structurally Social Security is not an insurance policy nor an investment plan correct?
structurally, it is run a bit like an insurance company. Revenues enter the system and some of those are used to pay current claims. any revenues remaining after paying current claims are invested.
In a traditional insurance company, current payees have a contractual right to those invested funds in future periods. Social Security is a bit different because:
1. By law, it must invest those funds in special treasury obligations. What makes those obligations "special" is that Congress is under no obligation to pay them.
Now isn't that special?
2. By law, no current payee has any contractual right to future revenues.
(as for investment plans, no - it's nothing at all like a personal investment plan)
The problem is that the language we use to talk about SS is quite disassociated from what SS actually is.
In more of a laymans terms...and not to sound like a conspiracist..
It is like a ponzi scheme...
The money they take in now is useed to pay people who they took money from in the past....and as the system is right now....there is going to be a time where SOMEONE put in money and there will be no more revenue to give that money back to them.
