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Thread: .......FACT CHECK: Are rich taxed less than secretaries?

  1. #1
    SiriuslyLong is offline
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    .......FACT CHECK: Are rich taxed less than secretaries?

    More right wing propoganda. More convolution of facts.

    By STEPHEN OHLEMACHER - Associated Press | AP

    WASHINGTON (AP) President Barack Obama makes it sound as if there are millionaires all over America paying taxes at lower rates than their secretaries.

    "Middle-class families shouldn't pay higher taxes than millionaires and billionaires," Obama said Monday. "That's pretty straightforward. It's hard to argue against that."

    The data tell a different story. On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.

    There may be individual millionaires who pay taxes at rates lower than middle-income workers. In 2009, 1,470 households filed tax returns with incomes above $1 million yet paid no federal income tax, according to the Internal Revenue Service. That, however, was less than 1 percent of the nearly 237,000 returns with incomes above $1 million.

    In his White House address Monday, Obama called on Congress to increase taxes by $1.5 trillion as part of a 10-year deficit reduction package totaling more than $3 trillion. He proposed that Congress overhaul the tax code and impose what he called the "Buffett rule," named for billionaire investor Warren Buffett.

    The rule says, "People making more than $1 million a year should not pay a smaller share of their income in taxes than middle-class families pay."

    Read it all here: http://news.yahoo.com/fact-check-ric...070642868.html

  2. #2
    Havakasha is offline
    This doesnt address your article directly, but It does show how the playing field has shifted on the wealthy. TOO BAD YOU DONT FACT CHECK MULTIPLE SOURCES. Typical S&L research. LOL. More to come.

    Wealth Redistribution? Wealthy Americans Are Taxed Less Now Than When Reagan Was President

    Apr 1st, 2010 |

    People often talk about how our country is attempting to redistribute wealth, but people seem to ignore that the wealthiest individuals are being taxed substantially less now than during most of this country’s recent history. From 1917 until now we have had tax rates for the highest incomes groups up to 92% of their income. That rate was not for just a few years. In 1917 the tax rate was 67% for this group and it was still 70% in 1980. From 1950 to 1963 the tax rate was 91% (92% in 1952 and 1952). During the Reagan presidency the tax rate topped out at 69.13%. The top tax rate in 2010 was 35%. The lowest tax rate during the last 90 years was 24% in 1929, the year the Great Depression began. So why are people concerned that the wealthiest Americans are getting taxed too much when they are being taxed at the historic low that they are now?
    Last edited by Havakasha; 09-20-2011 at 10:21 AM.

  3. #3
    Havakasha is offline
    POLITIFACT.COM


    The Truth-O-Meter Says: TRUE

    The "mega-rich" pay about 15 percent in taxes, while the middle class "fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot."
    Warren Buffett on Sunday, August 14th, 2011 in a "New York Times" op-ed

    Warren Buffett says the super-rich pay lower tax rates than others

    It's not often you see someone stand up and say, "Tax me more!"

    Yet that's just what famed investor Warren Buffett has done in an op-ed in the New York Times headlined, "Stop Coddling the Super-Rich." Buffett says that very wealthy people like himself pay lower tax rates than the middle class, thanks to special tax categories for investment income.

    "While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks," he writes.

    As an example, Buffett said he paid an effective tax rate of 17.4 percent, while people who worked in his office made much less but paid higher effective tax rates of between 33 percent and 41 percent, averaging 36 percent.

    "If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot," Buffett wrote. "To understand why, you need to examine the sources of government revenue. Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot."

    Buffett's op-ed inspired a reader to write to us and ask how Buffett's numbers could be correct. As our previous fact-checks have shown, about half of all Americans pay no federal income taxes because they are low income. And when you analyze who pays the bulk of federal income taxes, it's people with higher incomes. So we decided to fact-check Buffett's statement that "the mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. ... (The middle class) fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot."

    Before we get to the heart of the fact-check, it's best if we review a few basics of the tax code that Buffett's op-ed takes for granted. This review proves the point that the federal tax code is extremely complicated, so bear with us.


    Income taxes. Federal income taxes are progressive, which means your income is taxed at higher rates as you make more money. Let's take a married couple filing jointly as an example. In 2011, after deductions and exemptions:

    • the income between $0 and $17,000 is taxed at 10 percent;
    • the income between $17,000 and $69,000 is taxed at 15 percent;
    • the income between $69,000 and $139,350 is taxed at 25 percent;
    • the income between $139,350 and $212,300 is taxed at 28 percent;
    • the income between $212,300 and $379,150 is taxed at 33 percent;
    • the income above $379,150 is taxed at 35 percent.

    Keep in mind that even if you're in the top bracket of 35 percent, you don't pay that tax rate on all your income. You pay 10 percent on the first $17,000, 15 percent on the money between $17,000 and $69,000, and so on.

    Payroll taxes. Payroll taxes are separate from income taxes. If you work for a company, your employer deducts the payroll taxes before you get your paycheck and sends the money on to the federal government. These taxes pay for Social Security and Medicare; it's listed as FICA on your pay stub. Typically, workers pay 6.2 percent of their first $106,800 in earnings for Social Security taxes, and they pay 1.45 percent on all their earnings for Medicare hospital coverage. The employer has to match those taxes, bringing total contributions on behalf of an individual to 12.4 percent for Social Security and 2.9 percent for Medicare. Last year, though, President Barack Obama and Congress knocked 2 percentage points off Social Security taxes for workers, as an economic stimulus measure. So this year, most of us are paying 4.2 percent while employers pay 6.2 percent. Oh, and if you're self-employed, you typically have to pay your share and the employer share for totals this year of 10.4 percent on earnings up to $106,800 and 2.9 percent on all income. Payroll taxes are not progressive -- the rates don't get higher the more you earn. In the case of the Social Security taxes, which disappear once your reach a certain level of earnings, the percentage actually gets smaller if your income is higher than the $106,800 cap.

    Head hurt yet? Ours, too.

    Taxes on investments. Okay, now we're getting closer to Buffett's main point here, and that's taxes on investments. The tax rates on investments tend to be lower than taxes on regular income. If you make money buying and selling stocks or receiving dividends from stock ownership, those earnings are generally taxed at 15 percent, the rate for long-term capital gains and qualified dividends.

    Some hedge fund managers and other finance-sector executives get taxed at this rate on their earnings because their compensation is classified as "carried interest" and taxed as a capital gain. (The Wall Street Journal breaks down how carried interest works.) In fact, some economists believe that the lower rates for capital gains actually encourages tax dodges, because it motivates high earners to look for ways to classify normal income as capital gains. Defenders say the lower tax rate helps the economy because it rewards investors for risk-taking and entrepreneurship. They also argue that taxing dividends amounts to double taxation because corporations pay taxes on their income before investors are paid dividends. We won't settle the argument here, but there's no doubt that investors get lower tax rates on their income than workers.

    Getting back to Buffett's op-ed, his claims rest on how these taxes interact with each other. The fact we're checking here is that "the mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes," while middle class taxpayers "fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot."

    He's right that a billionaire whose income is mostly from investments is probably taxed at a lower rate than someone who has an ordinary job. Very little of this taxpayer's income is wage income, so payroll taxes don't take much of a bite. It seems likely that much of this hypothetical person's income would be taxed around the 15 percent rate. And, in fact, as Buffett says, statistics from the Internal Revenue Service show that the 400 wealthiest taxpayers pay tax rates of less than 20 percent.

    On the other side of the equation, people who work for a living, especially those who make higher than average salaries, get taxed at higher rates. It gets a little complicated, given how the tax brackets work, but basically, people who make between $100,000 and $200,000 are paying around 20 percent in income taxes, and it goes up from there, according to an analysis from the nonpartisan Tax Policy Center.

    Buffett slightly glosses over the fact that if you're in the 25 percent tax bracket, your overall tax rate is less than 25 percent. And, the more money you make, the more income taxes you pay, while payroll taxes seem less and less significant as a percentage of income. We're dubious someone would pay as high as a 41 percent tax rate, as Buffett claims someone in his office now pays. (The top income tax rate is 35 percent, but payroll taxes as a share of income decline as income rises, which makes it difficult to get above 37.9 percent, according to the people we ran this by at the Tax Policy Center.) We contacted Buffett's offices as Berkshire Hathaway about this point but didn't hear back.

    One final note: People who don't pay any income tax at all tend to have limited incomes, or they qualify for enough deductions -- think of child tax credits and mortgage interest -- that they have no income. When Buffett talks about people in the middle class who pay more taxes than he does, he's thinking of people who make much higher than average salaries.

    So when it comes to Buffett's statement, there are two categories: the rich and the really rich. And the evidence tends to point to the conclusion that the really rich pay less in taxes as a percentage of income then their merely well-to-do counterparts -- if their income comes primarily from investments. Overall, we rate Buffett's statement True.

  4. #4
    Havakasha is offline
    The Truth-O-Meter Says: MOSTLY TRUE

    The richest 400 taxpayers are taxed at a lower rate than a $29,000-a-year worker
    Sheldon Whitehouse on Sunday, February 13th, 2011 in a speech

    Whitehouse says richest 400 taxpayers are taxed at a lower rate than a $29,000-a-year worker

    Are the rich undertaxed?

    The answer often depends on who is speaking and how they choose to look at it.

    Those who argue that the rich are actually overtaxed may say, for example, that the people whose incomes are in the top 1 percent pay roughly 23 percent of all federal taxes. (Others who have this opinion argue that the burden on the rich is even higher. PolitiFact.com examined those claims in 2010.)

    At a Feb. 13 community dinner at the Pilgrim Senior Center, in Warwick, Sen Sheldon Whitehouse offered a different perspective to argue that the richest aren't overtaxed at all.

    "The IRS recently reported that the 400 biggest income earners in the country were making $334 million each, and were paying 16.6 percent in taxes," he said.

    According to an account of the meeting in The Warwick Beacon, Whitehouse went on to say that, most people wouldn’t have a tax rate that low unless their income was $28,100 or below.

    "A hospital orderly making $29,000 a year is therefore paying a higher rate of taxes on their income than someone making $344 million," the Beacon quoted Whitehouse as saying.

    We decided to check elements of both statements -- the rate the rich paid and the lower income level that would trigger a similar rate.

    When we asked Whitehouse's staff for the source of the 16.6 percent figure, they sent us to an IRS website that has statistics on the tax returns of the 400 individual taxpayers with the highest adjusted gross incomes. The most recent tax year available is 2007.

    (According to a transcript provided to us by the Whitehouse staff, the senator actually said he thought the report was from 2009.)

    One other clarification is important. The IRS is reporting on the top 400 individual tax returns, which could include a couple filing jointly.

    The IRS report says that, in 2007, the average adjusted gross income for the top 400 returns was $344 million. The average income tax paid per return was $57 million -- an average of 16.6 percent, as Whitehouse said. So on that point, he was right.

    Out of curiosity, members of PolitiFact Rhode Island checked our returns for 2007. We found that our tax rates were even lower than 16.6 percent, and we make a lot more than Whitehouse's hypothetical $29,000-a-year hospital orderly.

    So we checked Whitehouse's example, using tax rates, standard deductions and personal exemptions for both 2007 and 2010.

    We discovered that Whitehouse was off -- way off.

    That unmarried orderly filing a simple single return would be taxed at a rate of 9.1 percent in 2007 and 8.7 percent in 2010, not more than 16.6.

    Then, using IRS tax tables and schedules, we did some math to determine how much income a single person filing the simplest tax return would need before his tax rate exceeded that of the richest Americans.

    To hit a tax rate of 16.6 percent, that orderly would need to have made about $68,750 in 2007 and $73,500 in 2010, we calculated.

    When we showed our numbers to Whitehouse's staff, they said our results were misleading because we failed to include taxes for Medicare (1.45 percent) and Social Security (6.2 percent on the first $106,000 of income).

    "The vast majority of the income of the 400 wealthiest Americans is not subject to payroll taxes, whereas a worker with annual income around $29,000 would have to pay payroll taxes on all of their income," a statement from Whitehouse’s office said.

    "Leaving this data out of any comparison will paint a very uneven picture of the total taxes paid by working-class Americans."

    Although IRS spokeswoman Peggy Riley said those taxes are not factored into the IRS analysis, we understand the point of including them because the Social Security tax, in particular, has a significant impact on low- and middle-income people.

    According to calculations by Whitehouse’s office -- which match our own -- when you include Social Security and Medicare taxes, the effective tax rate for the wealthiest 400 Americans would have been 16.72 percent in 2007; the tax rate for a worker earning $29,000 a year would have been 16.79 percent.

    In short, Whitehouse accurately reported the IRS's most recent summary of its top 400 tax filers, even if he incorrectly cited the year of the report.

    When we audited his suggestion that the super-rich pay a lower rate than someone making just $29,000, we concluded he's right if you include all payroll taxes, but off by about $40,000 if you only consider income tax, as the IRS report does.

    We rate his statement as Mostly True.
    Last edited by Havakasha; 09-20-2011 at 10:21 AM.

  5. #5
    SiriuslyLong is offline
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    Ah, the fanatic is here!!! On his liberal crusade to make the US right lol.

    The data tell a different story. On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.

    Lloyd - look to the left. A picture is worth a thousand words. Screw it, here's a link.

    http://www.google.com/imgres?q=top+5...w=1218&bih=628

  6. #6
    SiriuslyLong is offline
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    One can certainly talk about tax rates, but at the end of the day, our government is spending tax dollars which is what is collected.

    And the subject is income tax. That is what is being discussed here as a key part of Obama's proposal. Yes, we get taxed a bunch of other ways.

  7. #7
    Havakasha is offline
    Do you really need to say silly things like "the fanatic is here"?. And YOU talk about me insulting
    you? lol. You seem to have an extreme case of projecting going on.
    Just argue your point of view.

    I presented facts from politifact.com an award winning non partisan organization. There are lots of ways to look at figures. You seem to choose those that represent your bias.

    What do you have to say about the politifact.com posts?
    Last edited by Havakasha; 09-20-2011 at 11:04 AM.

  8. #8
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    Do you really need to say silly things like "the fanatic is here"?. And YOU talk about me insulting
    you? lol. You seem to have an extreme case of projecting going on.
    Just argue your point of view.

    I presented facts from politifact.com an award winning non partisan organization. There are lots of ways to look at figures. You seem to choose those that represent your bias.

    What do you have to say about the politifact.com posts?
    You seem to choose the facts that represent your position.

    You are on a crusade. It came to me when I went to page 58 of the politics thread. I skimmed down to about page 20. Dude, you've been crusading for nearly 3 years. John makes a post, you make 5. With me, you post the same article in 6 different threads. How else can one explain this behavior? You are fanatical about your political position, no? It's ok; we are all under the standard normal curve.

    This is your religion. You want others to believe your point of view.
    Last edited by SiriuslyLong; 09-20-2011 at 11:23 AM.

  9. #9
    SiriuslyLong is offline
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    Quote Originally Posted by Havakasha View Post
    What do you have to say about the politifact.com posts?
    I already said it.

    One can certainly talk about tax rates, but at the end of the day, our government is spending tax dollars which is what is collected.

    And the subject is income tax. That is what is being discussed here as a key part of Obama's proposal. Yes, we get taxed a bunch of other ways.


    Actually, there are some parts of Obama's tax package that I like. For example, taxing overseas profit. I'll try to find that article.

  10. #10
    Havakasha is offline
    So thats what you posted in response to Politifact.com? To those 2 long articles? Whatever.

    You posted ThIS thread. I responded. Sorry if that upsets you. I'm on no "crusade". More hyperbole and EXAGGERATION by S&L. Whats new? lol
    Just posted some interesting artlcles by Politifact.com. countering your point of view.I thought i would get you to give me a thoughtful response to them.

    "you want others to believe your point of view". We all would like to influence what people who read us think. I try to post as many facts as i can to counter what I think are falsehoods. Thats called political argument.

    You seem to be very poor at looking at your OWN part in this. Grow up a little.
    Like Ive said before, go ahead and argue your point of view. But dont hide and then cry when
    you have been caught on the wrong side of an argument. Again look at the peter schiff thread.
    just one example. Climate change another.......

    (and by the way did you erase one of your posts on the climate change thread where you claimed your scientists were Climate scientists? It seemed to disappear. lol)
    Last edited by Havakasha; 09-20-2011 at 12:20 PM.

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