Mitt Romney pays a lower tax rate than you do.

[Ravi]

SO, the spinners keep repeating how "Mitt Romney pays a lower tax rate than you do", but that is patently and deliberately misleading...

Mitten isn't the company. If he got paid $1 as a dividend his tax would be lower than if he got it as an employee.

That article is simply trying to muddy the waters.

btw, Mitten gets to write off MORE of his charitable donations than anyone in the middle class.

I didn't like the way that article used Mitt and Obama's names in their example either, because it does make it more confusing to comprehend the point, but the point still stands...


And yes most middle class tax payers are better off taking the standard deduction rather than itemizing their deductions. I think it's great Mitt has been such a productive citizen that he has contributed millions of dollars to charities...He deserves to deduct that cost from his taxable income...An income which was so significant that even after all of his deductions, he was still liable to pay two plus million more in taxes, last year alone...


Implying that an individual who earns say $60k a year is somehow paying more in taxes or that they are somehow deprived for being unable to deduct more charitable contributions, is just silly...

I wasn't talking about them using Mitten's and Obama's names.

 

[Valerie]

Mitten isn't the company. If he got paid $1 as a dividend his tax would be lower than if he got it as an employee.

That article is simply trying to muddy the waters.

btw, Mitten gets to write off MORE of his charitable donations than anyone in the middle class.

I didn't like the way that article used Mitt and Obama's names in their example either, because it does make it more confusing to comprehend the point, but the point still stands...


And yes most middle class tax payers are better off taking the standard deduction rather than itemizing their deductions. I think it's great Mitt has been such a productive citizen that he has contributed millions of dollars to charities...He deserves to deduct that cost from his taxable income...An income which was so significant that even after all of his deductions, he was still liable to pay two plus million more in taxes, last year alone...


Implying that an individual who earns say $60k a year is somehow paying more in taxes or that they are somehow deprived for being unable to deduct more charitable contributions, is just silly...

I wasn't talking about them using Mitten's and Obama's names.

Care to explain what you ARE talking about.........?

 

[Seawytch]

The problem is not whether Romney did anything illegal, which he didn't...but about the rules being fixed in his favor.

HIS favor? how about holier than thou blowhard warren buffett? he talks a good game but shelters every dime of income from whatever source or vehicle he can, stop being a slobbering partisan for a change.

Uh...rules are rigged in Buffets favor too. Buffet wants to change that. Romney would vote himself more tax breaks.

I love when "slobbering partisans" call me a partisan hack.

 

[PLYMCO_PILGRIM]

Romney paid 15 percent. cap gains

Obama on his 2010 tax returns paid around 25 percent. personal income

Basic tax rate for MOST Americans is around 28 percent. not true over 50% of americans pay under 15% income tax

Still think Romney is a good idea?

Obama only paid 15% on his capital gains though!

 

[PLYMCO_PILGRIM]

Can we finally put this specious argument to rest?

If the average income is 50K and we assume one is single with absolutely no deductions other than the 1 personal exemption here is the breakdown. Let's also assume a state tax rate of 6%

The breakdown annually of withholding is

FICA OASDI $2,100.00
FICA Medicare $725.00
Federal tax $8,100.00
State & local tax $3,000.00

Your federal income tax liability would be

6250

and that is 12.5%

Now you add rug rats and mortgage interest into the equation and the percentage drops even lower.

Are we done yet?

Get out of here with honest facts, we are trying to do a dishonest war on the rich attack on romney in here

 

[Trajan]

The problem is not whether Romney did anything illegal, which he didn't...but about the rules being fixed in his favor.

HIS favor? how about holier than thou blowhard warren buffett? he talks a good game but shelters every dime of income from whatever source or vehicle he can, stop being a slobbering partisan for a change.

Uh...rules are rigged in Buffets favor too. Buffet wants to change that. Romney would vote himself more tax breaks.

I love when "slobbering partisans" call me a partisan hack.

you are a slobbering hack because you put forth this BS to make yourself feel good while you fool yourself , don't try fooling us, buffett gives his money to foundations, totally sheltered, he was asked why he didn't just voluntarily pay a higher rate...know what he said? Go, check it out, then get back to me. he and the rest them can always send a check, anytime they want to, they don't do they? why not? grow up, talk is cheap.

 

[Skull Pilot]

Romney paid 15 percent. cap gains

Obama on his 2010 tax returns paid around 25 percent. personal income

Basic tax rate for MOST Americans is around 28 percent. not true over 50% of americans pay under 15% income tax

Still think Romney is a good idea?

Your actual tax burden is not equal to your top marginal rate.

Why is this so hard to understand?

 

[Valerie]

The problem is not whether Romney did anything illegal, which he didn't...but about the rules being fixed in his favor.

HIS favor? how about holier than thou blowhard warren buffett? he talks a good game but shelters every dime of income from whatever source or vehicle he can, stop being a slobbering partisan for a change.

Uh...rules are rigged in Buffets favor too. Buffet wants to change that. Romney would vote himself more tax breaks.

I love when "slobbering partisans" call me a partisan hack.

Romney is not responsible for the current tax structure and no, that's Newt who wants to eliminate capital gains taxes altogether. You're making assumptions about Mitt's intentions based on your bias against his him...


http://mittromney.com/sites/default...America-PlanForJobsAndEconomicGrowth-Full.pdf

 

[Ravi]

I didn't like the way that article used Mitt and Obama's names in their example either, because it does make it more confusing to comprehend the point, but the point still stands...


And yes most middle class tax payers are better off taking the standard deduction rather than itemizing their deductions. I think it's great Mitt has been such a productive citizen that he has contributed millions of dollars to charities...He deserves to deduct that cost from his taxable income...An income which was so significant that even after all of his deductions, he was still liable to pay two plus million more in taxes, last year alone...


Implying that an individual who earns say $60k a year is somehow paying more in taxes or that they are somehow deprived for being unable to deduct more charitable contributions, is just silly...

I wasn't talking about them using Mitten's and Obama's names.

Care to explain what you ARE talking about.........?

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

 

[Trajan]

I wasn't talking about them using Mitten's and Obama's names.

Care to explain what you ARE talking about.........?

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

EVERYONE who pays the cap gain rate pays it becasue the government understands to some extent, ( some admins more than others) it makes sense to reward RISK. The cap gains issue is a risk reward venture. People will not RISK as much, IF they do not see a commensurate advantage on the back end if successful. And even then before one dime passes to their hands, the government takes a piece via the corporate entity that generated it from the original source.

This whole argument is dishonest without acknowledging that fact.

this is not about that though,imho , its about hammering romney for doing what every single liberal entrepreneur and and investor does too.

Let me ask you a question- how was obamas book proceeds taxed? Do you know? How are the proceeds of that money he earned via those sales used? You think its sitting in 1% interest CD? Does obama have a portfolio where in he has cap gains accrued? has he realized any? What was HIS rate on those gains?

For those that don't know, you are it appears to me employing a very selective form of partisan BS.

 

[Ravi]

Care to explain what you ARE talking about.........?

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

EVERYONE who pays the cap gain rate pays it becasue the government understands to some extent, ( some admins more than others) it makes sense to reward RISK. The cap gains issue is a risk reward venture. People will not RISK as much, IF they do not see a commensurate advantage on the back end if successful. And even then before one dime passes to their hands, the government takes a piece via the corporate entity that generated it from the original source.

This whole argument is dishonest without acknowledging that fact.

this is not about that though,imho , its about hammering romney for doing what every single liberal entrepreneur and and investor does too.

Let me ask you a question- how was obamas book proceeds taxed? Do you know? How are the proceeds of that money he earned via those sales used? You think its sitting in 1% interest CD? Does obama have a portfolio where in he has cap gains accrued? has he realized any? What was HIS rate on those gains?

For those that don't know, you are it appears to me employing a very selective form of partisan BS.

I understand about the risk and the reasoning for the lower rate. However, the rate didn't need to be lowered to 15%. People have always invested and they always will. In fact you could make a case that everyone went too far with their risks and helped bring down the economy when the rate was lowered to 15%.

I think book royalties are taxed as regular income, not as a capital gain. I also think he donated his royalties to charity.

But that has nothing to do with the fairness or unfairness of taxing different types of income at different rates.

 

[Willys]

True Story.

Romney Says His Effective Tax Rate Is ‘Probably’ 15%

Yep, Because his only income is from Capital gains.

You too can enjoy this low % when you see gains in your own Retirement Portfolio, It is not just for the rich.

But obviously NOT for the ignorant.

 

[Willys]

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

EVERYONE who pays the cap gain rate pays it becasue the government understands to some extent, ( some admins more than others) it makes sense to reward RISK. The cap gains issue is a risk reward venture. People will not RISK as much, IF they do not see a commensurate advantage on the back end if successful. And even then before one dime passes to their hands, the government takes a piece via the corporate entity that generated it from the original source.

This whole argument is dishonest without acknowledging that fact.

this is not about that though,imho , its about hammering romney for doing what every single liberal entrepreneur and and investor does too.

Let me ask you a question- how was obamas book proceeds taxed? Do you know? How are the proceeds of that money he earned via those sales used? You think its sitting in 1% interest CD? Does obama have a portfolio where in he has cap gains accrued? has he realized any? What was HIS rate on those gains?

For those that don't know, you are it appears to me employing a very selective form of partisan BS.

I understand about the risk and the reasoning for the lower rate. However, the rate didn't need to be lowered to 15%. People have always invested and they always will. In fact you could make a case that everyone went too far with their risks and helped bring down the economy when the rate was lowered to 15%.

I think book royalties are taxed as regular income, not as a capital gain. I also think he donated his royalties to charity.

But that has nothing to do with the fairness or unfairness of taxing different types of income at different rates.

Fairness of the U.S. tax system has little to do with reality. Romney pays tax on capital gains, no tax on income... BECAUSE he has no income.

Warren Buffet pays a lower tax rate than his secretary for a like reason. She pays taxes on income. Buffet pays taxes on capital gains. Not the same tax, just fraudulently used in the SOTU as a ruse.

 

[ABikerSailor]

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

EVERYONE who pays the cap gain rate pays it becasue the government understands to some extent, ( some admins more than others) it makes sense to reward RISK. The cap gains issue is a risk reward venture. People will not RISK as much, IF they do not see a commensurate advantage on the back end if successful. And even then before one dime passes to their hands, the government takes a piece via the corporate entity that generated it from the original source.

This whole argument is dishonest without acknowledging that fact.

this is not about that though,imho , its about hammering romney for doing what every single liberal entrepreneur and and investor does too.

Let me ask you a question- how was obamas book proceeds taxed? Do you know? How are the proceeds of that money he earned via those sales used? You think its sitting in 1% interest CD? Does obama have a portfolio where in he has cap gains accrued? has he realized any? What was HIS rate on those gains?

For those that don't know, you are it appears to me employing a very selective form of partisan BS.

I understand about the risk and the reasoning for the lower rate. However, the rate didn't need to be lowered to 15%. People have always invested and they always will. In fact you could make a case that everyone went too far with their risks and helped bring down the economy when the rate was lowered to 15%.

I think book royalties are taxed as regular income, not as a capital gain. I also think he donated his royalties to charity.

But that has nothing to do with the fairness or unfairness of taxing different types of income at different rates.

Interestingly enough, most of those "charitable donations" were in the form of a tithe that Romney is REQUIRED to pay to the Mormon Church every year, which amounts to a full ten percent.

 

[dadsgm]

So What if pay a lower percentage rate in income tax.
I could care less. At least they are paying the tax. If there is any unfairness in the system it is and has been caused by Congress, both Rpublican and Democratic, who passed the rules aloowing for all the exemptions/loop holes.
If you are going to complain the blame the Congress. The so-called rich are only taking advantage of the rules to save as much of their income as possible. It is the same principal used nby everyone to maximize the largest refund possible or to make the lowest payment as possible. It is the rules which are the problem and Congress has to change them.

 

[Valerie]

I wasn't talking about them using Mitten's and Obama's names.

Care to explain what you ARE talking about.........?

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

The point was to illustrate that ordinary income is taxed only once, at the personal level, while capital gains are taxed twice, both at the personal level and at the corporate level, thus justifying the differing tax rates for different types of income...

Ordinary income is taxed only once, at the personal level; capital gains are taxed twice, both at the personal level and at the corporate level.


Consider an individual, who owns a share of stock of a particular company. We’ll call this person Joe. This means that Joe owns a part of that company. In effect, he owns a share of the profit of the company. Let’s also say that this company has an employee. We’ll call him Bob. He represents the working class.

After all expenses but tax, the company has earned some amount of money. Let’s say that Joe’s share of the pretax earnings is $1 (based on the fact that he owns one share of stock).

There are two scenarios. First, the company could use the dollar to pay Bob additional compensation, the way that most working-class Americans derive their income. Alternatively, Joe could receive the money as a dividend distribution.


Let’s look at how taxes play out under each scenario.

If Bob receives the $1 as compensation, the company won’t have to pay taxes on the dollar. Paying employees is a pre-tax expense for businesses. However, Bob will have to pay ordinary income taxes on this money. Let’s say that his marginal tax rate is 35 percent (that’s probably a high estimate, but we’ll err on the side of conservatism). That means that Bob will pay $0.35 in income tax and he will get to keep $0.65.

Now, let’s consider the scenario where the company decided to pay a dividend with this pre-tax dollar. In this case, the company would have to pay taxes on the dollar. Let’s say that the company’s marginal tax rate is 35 percent. The company will pay $0.35 in corporate taxes and Joe will receive $0.65 in dividends. However, Joe will still have to pay a 15 percent tax on the dividend. Therefore, he will have to pay almost $0.10 of additional tax and will be left with only about $0.55.

In summary, if the company paid Bob $1 of compensation, he would get to keep $0.65 after tax. If the company used the same pre-tax dollar to pay Joe a dividend, he gets only $0.55 after tax, because the money is taxed both at the corporate level and at the individual level.

Although Joe’s tax rate looks to be 15 percent, the government actually nets almost 30 percent more money ($0.45 instead of $0.35)! So, if the taxes that the company paid on Joe’s share of the earnings are added to the 15 percent that Joe paid personally, the effective tax rate was actually 45 percent compared to Bob’s effective tax rate of 35 percent!



When people, including President Obama, say that those paying capital gains tax are paying less than those paying ordinary income tax, they are ignoring the fact that the capital gains have already been taxed at the corporate level. They are not mentioning that the 15 percent tax at the personal level is a second bite at the apple.

Romney?s Tax Return: You?re Not Getting the Whole Story - International Business Times

 

[Vast LWC]

it was already taxed once as income, now you want to double dip.

why cant you just admit it, you want to steal

Again with this argument?

There is no "double tax" on capital gains.

1. Stocks are not based on company earnings. They do not go up and down based on company profit.

2. The principle investment is not taxed again, it is only the value increase that is taxed after an investment is made. Value decreases can in fact be written off as losses.

3. There is no effective difference between wages and dividends, as both are based on how much revenue a company has in the first place. The more a company makes, the more it can pay it's workers, or the more workers it can hire, and the more dividends it can afford to give out.

The only difference between the two is what kind of contribution is being made. In one case, it's time and effort, in the other, it's capital.

Why should my bonus or my overtime be taxed at a MUCH higher rate than dividends when it's basically the same thing?

So, if there is a "double tax" on capital gains then there is a "double tax" on salary in the first place.

 

[Vast LWC]

So 6.2 million dollars? What's the problem? Why isn't 6.2 million dollars enough?

Because in order to make the 45 million dollars that he paid 6+ million dollars in taxes on (which actually in the end came out to 13.9%), his corporate assets used a much greater share of public resources than the average individual.

Which is of course the point of having an income tax.

If you're a homeless person, living in a box in the woods somewhere, you don't use any public resources.

If you're a captain of industry, and make millions of dollars off of commercial enterprises, you use a huge amount of public resources.

 

[Ravi]

Care to explain what you ARE talking about.........?

The article is silly.

It seems to be saying that Mitt gets to pay a lower tax rate because salaries are an expense while profits are not. Mitt pays less because the business has to pay tax on profit. Well, so does the employee. The employee's salary IS a profit on the employee's labor.

The point was to illustrate that ordinary income is taxed only once, at the personal level, while capital gains are taxed twice, both at the personal level and at the corporate level, thus justifying the differing tax rates for different types of income...

Ordinary income is taxed only once, at the personal level; capital gains are taxed twice, both at the personal level and at the corporate level.


Consider an individual, who owns a share of stock of a particular company. We’ll call this person Joe. This means that Joe owns a part of that company. In effect, he owns a share of the profit of the company. Let’s also say that this company has an employee. We’ll call him Bob. He represents the working class.

After all expenses but tax, the company has earned some amount of money. Let’s say that Joe’s share of the pretax earnings is $1 (based on the fact that he owns one share of stock).

There are two scenarios. First, the company could use the dollar to pay Bob additional compensation, the way that most working-class Americans derive their income. Alternatively, Joe could receive the money as a dividend distribution.


Let’s look at how taxes play out under each scenario.

If Bob receives the $1 as compensation, the company won’t have to pay taxes on the dollar. Paying employees is a pre-tax expense for businesses. However, Bob will have to pay ordinary income taxes on this money. Let’s say that his marginal tax rate is 35 percent (that’s probably a high estimate, but we’ll err on the side of conservatism). That means that Bob will pay $0.35 in income tax and he will get to keep $0.65.

Now, let’s consider the scenario where the company decided to pay a dividend with this pre-tax dollar. In this case, the company would have to pay taxes on the dollar. Let’s say that the company’s marginal tax rate is 35 percent. The company will pay $0.35 in corporate taxes and Joe will receive $0.65 in dividends. However, Joe will still have to pay a 15 percent tax on the dividend. Therefore, he will have to pay almost $0.10 of additional tax and will be left with only about $0.55.

In summary, if the company paid Bob $1 of compensation, he would get to keep $0.65 after tax. If the company used the same pre-tax dollar to pay Joe a dividend, he gets only $0.55 after tax, because the money is taxed both at the corporate level and at the individual level.

Although Joe’s tax rate looks to be 15 percent, the government actually nets almost 30 percent more money ($0.45 instead of $0.35)! So, if the taxes that the company paid on Joe’s share of the earnings are added to the 15 percent that Joe paid personally, the effective tax rate was actually 45 percent compared to Bob’s effective tax rate of 35 percent!



When people, including President Obama, say that those paying capital gains tax are paying less than those paying ordinary income tax, they are ignoring the fact that the capital gains have already been taxed at the corporate level. They are not mentioning that the 15 percent tax at the personal level is a second bite at the apple.

Romney?s Tax Return: You?re Not Getting the Whole Story - International Business Times

sigh...even that is silly. The company pays a tax on its profit. Mitten pays a tax on his profit. It's the PROFIT of each individual (company or person) that is being taxed.

 

[Vast LWC]

Actually....the stock market really boomed when capital gain taxes were lowered and the PE of many sector stocks rose.

Like I said we are all equal...poor and rich, you're the one that has divided the two into good and evil, Chris.

The roaring 20's anyone?

That is an excellent comparison Pilgrim.

And in both cases, the ridiculously low cap gains tax rates encouraged people to over-leverage themselves into a giant Wall Street bubble, instead of trying to make money through normal means, like wages. And then the bubble collapsed.

The situations are almost exactly the same, except this time the commodity was real estate.