Comments on: The Bad Max Tax

By: PJEvans

PJEvans — Wed, 09 Sep 2009 01:45:02 +0000

Well, last spring, I paid the Feds $13,000, because I had capital gains (and that was using as much of the losses as I could). That’s on a taxable income of $67000, single, renting. (I also paid the state of CA $2600, on taxable income of $73000. That’s equal to a month’s take-home pay for me.)

I can tell that Max is totally clueless about the real world.

By: SparklestheIguana

SparklestheIguana — Wed, 09 Sep 2009 00:29:02 +0000

Amen.

Because we worship the market. We allow the profit motive to determine everything. That’s what makes us different from every other country.

By: SparklestheIguana

SparklestheIguana — Wed, 09 Sep 2009 00:25:35 +0000

Unfortunately, they’re like roaches. There’s always more where they came from.

This EW post has me more depressed than any in a long time.

We are so fucked. (America, the middle class, progressives….everyone but the wealthy and the special interests. All fucked.)

By: shma

shma — Tue, 08 Sep 2009 23:05:08 +0000

I logged in just to talk about this (note to whoever deals with the comments section: don’t put people’s passwords on the screen after they sign up. If new users are in a public place, anyone will be able to see the password).

The IRS says that all premiums and medical expenses for your family are tax deductible after you spend more than 7.5% of your income. So for the family of four earning 67K a year, 15585 dollars of the Baucus Tax are deductible (7.5% of 67K is $5025, $20610-$5025=$15585). That means the family’s taxable income is at most $51415.

However, it is almost impossible that medical deductions would be the only deductions on their tax bill. In fact, from what I’ve found on the Internet, there’s probably an additional 11K of deductions. Unfortunately, this info is very outdated (although it is IRS data), and all I have done is convert the money to US 2008 dollars to take into account inflation. But, assuming this is roughly right, the family’s taxable income is 40K, which means their federal tax would be about 6200 dollars, significantly smaller than 8700.

To get an accurate number, what you need to do is find out from the IRS:
a: What the current average tax deduction is for medical expenses for a family of four (at that income level)
b: What the current total average tax deduction is for a family of four (at that income level)

Then find $51415 - b + a (which is the family’s taxable income), and compute the federal tax owed on that final amount.

My guess is that it is significantly lower than the CBO estimate, specifically because the Max Tax allows for a much higher medical deductible.

By: druidity36

druidity36 — Tue, 08 Sep 2009 21:07:56 +0000

All right. I guess no one wants to touch my question about scoring Single Payer (HR676).

Save 400 billion a year vs. spend a trillion in ten….

I think i’ll save the money, thank you.

By: PeorgieTirebiter

PeorgieTirebiter — Tue, 08 Sep 2009 20:35:46 +0000

Provided my current health insurer isn’t emboldened by our government’s strong show of impotence, I won’t be affected financially, but…
The act of even floating an idea this obscene is beyond my comprehension.
I’m 57, only moderately liberal, and not even close to being well off.
I don’t believe, contrary to the CW, that my willingness to take a little less, or give a little more is unique. But I would be forever resentful of putting so much as an extra nickle in an insurance company’s pocket.

By: Gitcheegumee

Gitcheegumee — Tue, 08 Sep 2009 20:00:00 +0000

“That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.
Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed.

But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.”

-The Declaration Of Independence

By: Lekkerkerk

Lekkerkerk — Tue, 08 Sep 2009 18:53:54 +0000

Yup, and let’s not forget our current VP was the engine behind that legislation.

By: earlofhuntingdon

earlofhuntingdon — Tue, 08 Sep 2009 18:51:18 +0000

I question whether those deductions are representative. They require owning a home with a hefty mortgage, but one the taxpayer remains able to pay. Medical deductions are subject to a floor, which limits their deductability. Many states disallow itemized deductions allowed by the feds, which makes more income subject to state tax. Local taxes are often a straight percentage, 2-3%, off the top with no deductions. Etc.

By: tbsa

tbsa — Tue, 08 Sep 2009 18:48:58 +0000

That is exactly what needs to happen to every one of these assholes who would rather support the insurance companies than the people.