Fixing Tax Loopholes, 51% of Americans Pay NO Incomes Taxes

[Contumacious]

The “half of Americans pay no income tax” fraud[/b]

One of the right-wing’s favorite talking points is the claim that 50 percent of American households don’t pay income taxes.....That claim is bogus both in its details and its general charge.
.

Nearly half of US households escape fed income tax

Recession, new tax credits have nearly half of US households paying no federal income tax


Nearly half of US households escape fed income tax - Yahoo! Finance

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[iamwhatiseem]

Sure there aren't. Firms aren't paying their employees' income tax, for example.

YES THEY DO.
OMG - don't you all hate the fact that people like this poster votes???
Every employer pays a BUNCH of employee taxes...what a...

My God, your reading compensation is terrible. The taxes on my salary come out of my salary, not out of my employer's coffers. That's not saying employers don't pay taxes on their employees (like unemployment taxes and employer share of FICA).

My reading compensation??

 

[Susan45]

The “half of Americans pay no income tax” fraud[/b]

One of the right-wing’s favorite talking points is the claim that 50 percent of American households don’t pay income taxes.....That claim is bogus both in its details and its general charge.
.

Nearly half of US households escape fed income tax

Recession, new tax credits have nearly half of US households paying no federal income tax


Nearly half of US households escape fed income tax - Yahoo! Finance

.

Go get 'em tiger.

Some have implied or suggested that people who do not owe federal income tax are “freeloaders” who don’t have a “stake in the system” and that making them pay federal income taxes would improve the tax code. Yet the vast majority of the people who owe no federal income taxes fall into one of three categories (see Figure 4):[17]
Misconceptions and Realities About Who Pays Taxes — Center on Budget and Policy Priorities

 

[Big Fitz]

From the CBPP

Misconceptions and Realities About Who Pays Taxes

Executive Summary

A recent finding by Congress’ Joint Committee on Taxation that 51 percent of households owed no federal income tax in 2009 [1] is being used to advance the argument that low- and moderate-income families do not pay sufficient taxes. Apart from the fact that most of those who make this argument also call for maintaining or increasing all of the tax cuts of recent years for people at the top of the income scale, the 51 percent figure, its significance, and its policy implications are widely misunderstood.

The 51 percent figure is an anomaly that reflects the unique circumstances of 2009, when the recession greatly swelled the number of Americans with low incomes and when temporary tax cuts created by the 2009 Recovery Act — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect. Together, these developments removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired.

# In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

# The 51 percent figure covers only the federal income tax and ignores the substantial amounts of other federal taxes — especially the payroll tax — that many of these households pay . As a result, it greatly overstates the share of households that do not pay any federal taxes. Data from the Urban Institute-Brookings Tax Policy Center show only about 14 percent of households paid neither federal income tax nor payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year.[3]

# This percentage would be even lower if federal excise taxes on gasoline and other items were taken into account.

# Most of the people who pay neither federal income tax nor payroll taxes are low-income people who are elderly, unable to work due to a serious disability, or students, most of whom subsequently become taxpayers. (In a year like 2009, this group also includes a significant number of people who have been unemployed the entire year and cannot find work.)

# Moreover, low-income households as a whole do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households’ incomes are — the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10 percent of their incomes in federal taxes.

# Even these figures understate low-income households’ total tax burden, because these households also pay substantial state and local taxes. Data from the Institute on Taxation and Economic Policy show that the poorest fifth of households paid a stunning 12.3 percent of their incomes in state and local taxes in 2010.[5]
Misconceptions and Realities About Who Pays Taxes — Center on Budget and Policy Priorities

I have reached a point where I don't expect the right to do any reading but this hate fest towards the poor is just a bit much.

Yeah.... about the CBPP.

After reading it's list of research and some of it's findings, this is a left wing policy advocacy group. It's data is suspect because it is pushing an agenda.

 

[kaz]

There is something to it, but Kaz widely overstates the case. It would certainly be true that the proposal would increase the price by a lower percentage than the percentage of the tax, but it's not true that prices would remain stable. What would be peeled out of prices are taxes firms pay (corporate income tax, employer share of FICA).

As I said, those taxes are part of the Fair Tax as well and they are part of the price you pay for products today. There is no difference between that and other taxes.

And prices would go down because of the reduction of economic inefficiency. Even moreso over time.

Sure there aren't. Firms aren't paying their employees' income tax, for example.

Of course they do.

Employees pay their income tax out of their salary.

Employee salary is paid by their company. That employees pay income tax means that it's part of what companies have to pay them. Employees must live, that means they must earn enough to pay for their home, their food, their car, and their...income taxes. So if companies don't pay enough to cover that, they won't work for them.

The company gets the money to pay salary from the sale of it's products.

 

[kaz]

Sure there aren't. Firms aren't paying their employees' income tax, for example.

YES THEY DO.
OMG - don't you all hate the fact that people like this poster votes???
Every employer pays a BUNCH of employee taxes...what a...

My God, your reading compensation is terrible. The taxes on my salary come out of my salary, not out of my employer's coffers. That's not saying employers don't pay taxes on their employees (like unemployment taxes and employer share of FICA).

If you don't earn enough to pay your taxes and live, you won't work for that employer. They pay you enough to pay your taxes. If they can't earn enough to pay you to live, including your taxes, they go out of business.

Your income taxes are payable only because they are baked into your product's cost and paid to you as salary to pay the tax. They clearly are baked into the price of products.

 

[kaz]

# In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

This is only true for zero taxes. Before the recession 47% of all earners paid only 4% of income taxes. So it was still ridiculously low

 

[Susan45]

From the CBPP

Misconceptions and Realities About Who Pays Taxes

Executive Summary

A recent finding by Congress’ Joint Committee on Taxation that 51 percent of households owed no federal income tax in 2009 [1] is being used to advance the argument that low- and moderate-income families do not pay sufficient taxes. Apart from the fact that most of those who make this argument also call for maintaining or increasing all of the tax cuts of recent years for people at the top of the income scale, the 51 percent figure, its significance, and its policy implications are widely misunderstood.

The 51 percent figure is an anomaly that reflects the unique circumstances of 2009, when the recession greatly swelled the number of Americans with low incomes and when temporary tax cuts created by the 2009 Recovery Act — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect. Together, these developments removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired.

# In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

# The 51 percent figure covers only the federal income tax and ignores the substantial amounts of other federal taxes — especially the payroll tax — that many of these households pay . As a result, it greatly overstates the share of households that do not pay any federal taxes. Data from the Urban Institute-Brookings Tax Policy Center show only about 14 percent of households paid neither federal income tax nor payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year.[3]

# This percentage would be even lower if federal excise taxes on gasoline and other items were taken into account.

# Most of the people who pay neither federal income tax nor payroll taxes are low-income people who are elderly, unable to work due to a serious disability, or students, most of whom subsequently become taxpayers. (In a year like 2009, this group also includes a significant number of people who have been unemployed the entire year and cannot find work.)

# Moreover, low-income households as a whole do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households’ incomes are — the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10 percent of their incomes in federal taxes.

# Even these figures understate low-income households’ total tax burden, because these households also pay substantial state and local taxes. Data from the Institute on Taxation and Economic Policy show that the poorest fifth of households paid a stunning 12.3 percent of their incomes in state and local taxes in 2010.[5]
Misconceptions and Realities About Who Pays Taxes — Center on Budget and Policy Priorities

I have reached a point where I don't expect the right to do any reading but this hate fest towards the poor is just a bit much.

Yeah.... about the CBPP.

After reading it's list of research and some of it's findings, this is a left wing policy advocacy group. It's data is suspect because it is pushing an agenda.

Of course you have to say this because otherwise your whole premise is bullshit.

If you have a site that has actually data, please feel free to post it, I'd like to see it. TIA

 

[Big Fitz]

From the CBPP

Misconceptions and Realities About Who Pays Taxes

Executive Summary

A recent finding by Congress’ Joint Committee on Taxation that 51 percent of households owed no federal income tax in 2009 [1] is being used to advance the argument that low- and moderate-income families do not pay sufficient taxes. Apart from the fact that most of those who make this argument also call for maintaining or increasing all of the tax cuts of recent years for people at the top of the income scale, the 51 percent figure, its significance, and its policy implications are widely misunderstood.

The 51 percent figure is an anomaly that reflects the unique circumstances of 2009, when the recession greatly swelled the number of Americans with low incomes and when temporary tax cuts created by the 2009 Recovery Act — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect. Together, these developments removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired.

# In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

# The 51 percent figure covers only the federal income tax and ignores the substantial amounts of other federal taxes — especially the payroll tax — that many of these households pay . As a result, it greatly overstates the share of households that do not pay any federal taxes. Data from the Urban Institute-Brookings Tax Policy Center show only about 14 percent of households paid neither federal income tax nor payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year.[3]

# This percentage would be even lower if federal excise taxes on gasoline and other items were taken into account.

# Most of the people who pay neither federal income tax nor payroll taxes are low-income people who are elderly, unable to work due to a serious disability, or students, most of whom subsequently become taxpayers. (In a year like 2009, this group also includes a significant number of people who have been unemployed the entire year and cannot find work.)

# Moreover, low-income households as a whole do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households’ incomes are — the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10 percent of their incomes in federal taxes.

# Even these figures understate low-income households’ total tax burden, because these households also pay substantial state and local taxes. Data from the Institute on Taxation and Economic Policy show that the poorest fifth of households paid a stunning 12.3 percent of their incomes in state and local taxes in 2010.[5]
Misconceptions and Realities About Who Pays Taxes — Center on Budget and Policy Priorities

I have reached a point where I don't expect the right to do any reading but this hate fest towards the poor is just a bit much.

Yeah.... about the CBPP.

After reading it's list of research and some of it's findings, this is a left wing policy advocacy group. It's data is suspect because it is pushing an agenda.

Of course you have to say this because otherwise your whole premise is bullshit.

If you have a site that has actually data, please feel free to post it, I'd like to see it. TIA

Be your own research monkey and check your source's agendas to boot. Next you're going to tell me blogs are trustworthy too. You got caught using a biased source. It's up to you to find something better.

 

[kaz]

Are we supposed to feel sorry for them because of that?

This is your problem, you want the tax code directed by who you like. When fiscal conservatives say not to punish the wealthy, treat them like everyone else, that's making them a privileged, protected class. The basic lie of liberalism is that you can ever achieve equality through inequity

 

[Susan45]

# In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

This is only true for zero taxes. Before the recession 47% of all earners paid only 4% of income taxes. So it was still ridiculously low

I can see it's really difficult to give up your class warfare battle against the poor. But if you really want to engage in a conversation you really shouldn't cherry pick one tiny bit out of a whole paper. That sentence was between two other sentences.

# The 51 percent figure is an anomaly that reflects the unique circumstances of 2009, when the recession greatly swelled the number of Americans with low incomes and when temporary tax cuts created by the 2009 Recovery Act — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect. Together, these developments removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired.

In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

# The 51 percent figure covers only the federal income tax and ignores the substantial amounts of other federal taxes — especially the payroll tax — that many of these households pay . As a result, it greatly overstates the share of households that do not pay any federal taxes. Data from the Urban Institute-Brookings Tax Policy Center show only about 14 percent of households paid neither federal income tax nor payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year.[3]

And then there is this.

Moreover, low-income households as a whole do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households’ incomes are — the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10 percent of their incomes in federal taxes.

 

[Big Fitz]

# In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

This is only true for zero taxes. Before the recession 47% of all earners paid only 4% of income taxes. So it was still ridiculously low

I can see it's really difficult to give up your class warfare battle against the poor. But if you really want to engage in a conversation you really shouldn't cherry pick one tiny bit out of a whole paper. That sentence was between two other sentences.

# The 51 percent figure is an anomaly that reflects the unique circumstances of 2009, when the recession greatly swelled the number of Americans with low incomes and when temporary tax cuts created by the 2009 Recovery Act — including the “Making Work Pay” tax credit and an exclusion from tax of the first $2,400 in unemployment benefits — were in effect. Together, these developments removed millions of Americans from the federal income tax rolls. Both of these temporary tax measures have since expired.

In a more typical year, 35 percent to 40 percent of households owe no federal income tax. In 2007, the figure was 37.9 percent. [2]

# The 51 percent figure covers only the federal income tax and ignores the substantial amounts of other federal taxes — especially the payroll tax — that many of these households pay . As a result, it greatly overstates the share of households that do not pay any federal taxes. Data from the Urban Institute-Brookings Tax Policy Center show only about 14 percent of households paid neither federal income tax nor payroll tax in 2009, despite the high unemployment and temporary tax cuts that marked that year.[3]

And then there is this.

Moreover, low-income households as a whole do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households’ incomes are — the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10 percent of their incomes in federal taxes.

I love it. Everyone's a class warrior to a class warrior. They can't see outside their own paradigm which only exists between their ears. It's nothing more than an update of the view of the world as a giant caste system full of envy and hate for anyone who aquires on merit and everything that makes people economically mobile and free.

 

[Susan45]

Yeah.... about the CBPP.

After reading it's list of research and some of it's findings, this is a left wing policy advocacy group. It's data is suspect because it is pushing an agenda.

Of course you have to say this because otherwise your whole premise is bullshit.

If you have a site that has actually data, please feel free to post it, I'd like to see it. TIA

Be your own research monkey and check your source's agendas to boot. Next you're going to tell me blogs are trustworthy too. You got caught using a biased source. It's up to you to find something better.

Sorry that bullshit isn't going to fly with me. Those figures were compiled from the CBO, the Tax Policy Center, Business Week and the census among other places. This is not a biased source you are just trying to change the subject to me and it isn't about me.

The fact is you don't have anything to refute those numbers and are trying raise a fuss so you can ignore them and continue on with your magical thinking.

 

[Susan45]

This is only true for zero taxes. Before the recession 47% of all earners paid only 4% of income taxes. So it was still ridiculously low

I can see it's really difficult to give up your class warfare battle against the poor. But if you really want to engage in a conversation you really shouldn't cherry pick one tiny bit out of a whole paper. That sentence was between two other sentences.

And then there is this.

Moreover, low-income households as a whole do, in fact, pay federal taxes. Congressional Budget Office data show that the poorest fifth of households as a group paid an average of 4 percent of their incomes in federal taxes in 2007 (the latest year for which these data are available), not an insignificant amount given how modest these households’ incomes are — the poorest fifth of households had average income of $18,400 in 2007. [4] The next-to-the bottom fifth — those with incomes between $20,500 and $34,300 in 2007 — paid an average of 10 percent of their incomes in federal taxes.

I love it. Everyone's a class warrior to a class warrior. They can't see outside their own paradigm which only exists between their ears. It's nothing more than an update of the view of the world as a giant caste system full of envy and hate for anyone who aquires on merit and everything that makes people economically mobile and free.

Wow! you shouldn't be so hysterical about it.

 

[oldsalt]

Right. no corp tax. We've all seen over the last 2 yrs, how when they reap reap record profits, have record liquid cash assets, they are the job creators. You people are ******* stupid.

 

[saveliberty]

How is it class warfare AGAINST the poor, if your busy taking what belongs to the rich and giving it to the poor? Why are you content supporting a cycle of poverty, lack of education and dependence on a set of rules you set up for them? It is your system that oppresses them, not free enterprise.

 

[Susan45]

Come on all you class warriors...which of these groups should we be going after?

 

[WillowTree]

Sure there aren't. Firms aren't paying their employees' income tax, for example.

YES THEY DO.
OMG - don't you all hate the fact that people like this poster votes???
Every employer pays a BUNCH of employee taxes...what a...

My God, your reading compensation is terrible. The taxes on my salary come out of my salary, not out of my employer's coffers. That's not saying employers don't pay taxes on their employees (like unemployment taxes and employer share of FICA).

What the **** is "reading compensation" exactly?

 

[WillowTree]

It doesn't matter if it's relevant to you. It's not relevant to the discussion. No matter how much you desired to do so, you couldn't realistically save more than 20% of your income (and even that is generous). It would be very easy for someone making $500,000 a year though to save 20%, or even 50%, of their income.

Yeah! so? they pay taxes on the interest too.

That assumes they spend it.

It assumes nothing of the sort.

 

[dblack]

What the **** is "reading compensation" exactly?

WTF? You guys are getting paid for reading this shit? Someone owes me some serious back pay.