Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers • Hacker News Board

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#151

Post by closeparen » Tue, Dec 05, 2017, 9:05 PM UTC

harryh wrote: post #115

jbooth wrote: post #56

Earlier quoted context omitted.

That's all fine, but IN CONTEXT, OP is still getting robbed. They're paying higher taxes while the super-rich pay lower taxes. They could have passed a bill that eliminated those deductions and gave corresponding tax breaks to the middle class. They could have passed a bill that skipped the tax breaks for the super-rich and actually cut the deficit. I'm OK with paying my fair share if we were actually solving problem…

There are tax breaks to the middle + lower classes. Lower bracket rates are lowered, the standard deduction (which is used by people on the lower end of the income spectrum much more) is dramatically increased, and the child tax credit is increased.

The relevant quantity is standard deduction + personal exemption(s) which is barely increasing for single people and declining drastically for families.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#152

Post by ctdonath » Tue, Dec 05, 2017, 9:05 PM UTC

nostromo wrote: post #12

I don't see why state taxes should be federally deductible to begin with. Two families both make $250,000 a year. One is in New York and one is in Texas. The family in Texas is carrying more of the federal tax burden than the family in New York. Why? Both are (in theory) receiving the same benefits from the Federal Government and should pay the same in taxes. If you're a progressive this should make even less sense:…

I don't see why state taxes wouldn't be federally deductible.

Roughly: if I work 6 hours, I have to work an additional hour a day just to earn money to give to the state; you're suggesting I should work an additional 15 minutes to earn money to give to the feds just because I earned the money to give to the state.

Absolutely I shouldn't be paying taxes on money earned just to pay taxes. It's not like I'm "shielding my earnings", because those earnings are earned specifically to get confiscated - you want me to earn more just because someone else took my money.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#153

Post by deadmetheny » Tue, Dec 05, 2017, 9:05 PM UTC

davidjnelson wrote: post #97

deadmetheny wrote: post #86

Earlier quoted context omitted.

Spoiler alert: if you make over $200,000 a year, you are the rich compared to most of the rest of the country. I love that a factual statement is getting downvoted, btw. Get a grip on your frame of reference, HN.

Rich is relative to housing costs.

Your $200,000 a year will get you by very nicely here in the Midwest. We even have jobs and accept the same currency you're paid in over in SV, imagine that!

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#154

Post by BeetleB » Tue, Dec 05, 2017, 9:06 PM UTC

hbarka wrote: post #53

vkou wrote: post #8

Earlier quoted context omitted.

> I cannot see this bill as anything short of theft. Why do I have to pay double-digit percentage more on my taxes to give the ultra rich a tax cut? In what fucking world does that make any economic sense. My rent isn't tax deductible. Why is yours blessed with such a status (In the form of a mortgage, and property tax deduction)? All that mortgage tax deductions do, economically, is increase the overall price of hom…

Relax. You’re not subsidizing anyone. Homeowners pay a larger share than renters to begin with. And if you know anything about Western society, home ownership creates stable societies—that’s why ownership is encouraged.

>Relax. You’re not subsidizing anyone. Homeowners pay a larger share than renters to begin with.

As someone who knows many landlords: Completely wrong.

They buy properties with a loan. They pay interest on that loan. The money the renter pays goes towards the interest payments. Renters are essentially buying the properties for the owners.

And landlords can keep deducting it, no matter how many properties. Homeowners can deduct only for two houses. And renters deduct none of it. The landlords literally deduct what their tenants are paying (interest, which is part of their rent).

And not sure about your other comment, but rarely do renters of similar size houses/apartments pay less than homeowners. As an example, my house I bought only a few years ago: I pay just a little more than some 3 bedroom apartments (which are much smaller than my house). Most 3 bedroom apartments in desirable areas in my city pay more in rent than my monthly payment.

And then with all the deductions I was getting, I was effectively paying less than most 2 bedroom apartments, and some single bedroom apartments. And if I take into account the amount going towards the principle, I'm paying about the same as most single bedroom apartments in my area.

I did not put in a huge down payment. Less than 20%, in fact.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#155

Post by harryh » Tue, Dec 05, 2017, 9:07 PM UTC

dragonwriter wrote: post #127

harryh wrote: post #115

Earlier quoted context omitted.

There are tax breaks to the middle + lower classes. Lower bracket rates are lowered, the standard deduction (which is used by people on the lower end of the income spectrum much more) is dramatically increased, and the child tax credit is increased.

> There are tax breaks to the middle + lower classes. The net impact is a tax increase on the very poorest in the short term; and on pretty much the whole segment up to a bit above median income over the 10 year period. Yes, there are individual provisions that, taken in isolation, benefit the working class, but in net it's a loss not a gain.

1) If we're also talking about how the cost of health insurance might change then you could be correct about the very poorest. It's a bit hard to say.

If we're only talking about taxes paid, then you are wrong there.

2) I think that the whole "over the 10 year period" is a bit of a red herring. The US tax system isn't getting set in concrete with the (potential) passage of this bill. Numerous things will almost certainly change over the next 10 years. Tax breaks set to expire will get extended. Rates will get tinkered with. It's hard to know what might happen. Because of this I think the short term effects matter much much more than what is theoretically set to happen in 10 years.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#156

Post by hcknwscommenter » Tue, Dec 05, 2017, 9:08 PM UTC

sergiotapia wrote: post #11

Florida here, I'm going be paying $4000 ish less in taxes. I hope the tax bill lands and is put to practice quick! People who make over $200k aren't getting as big a tax break? I don't feel bad about that.

"People who make over $200k aren't getting as big a tax break? I don't feel bad about that."

According to the CBO, people who make less than $75k get a tax increase by 2027 (on average). People who make between 75K and 500K get a very small tax deduction on average. Blue state residents get a tax increase almost across the board at >200K<1M. Almost anyone who makes more than a million a year gets a sizeable tax deduction.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#157

Post by closeparen » Tue, Dec 05, 2017, 9:09 PM UTC

TheAdamAndChe wrote: post #123

munk-a wrote: post #114

Earlier quoted context omitted.

... And then it removes the alternative minimum tax, starts to phase out the estate tax and lowers pass through income tax rates. This tax cut might hit some really stupid rich people hard, but anyone wise enough to hire an accountant is going to get a lot more take home.

Looking at the new tax law as a whole, you are right, but the focus of this article is on changes to the state and local tax deduction, which currently favors rich states with high taxes.

People in expensive states are not somehow better off, dollar amounts are just higher in both the labor and real estate markets. It’s better understood as localized inflation than localized wealth.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#158

Post by hcknwscommenter » Tue, Dec 05, 2017, 9:10 PM UTC

sergiotapia wrote: post #112

cbhl wrote: post #29

This seems win-win to me. Techies and bankers pay more in taxes. People in fly-over states get a small tax cut, and maybe can buy a few extra weeks' groceries for their kids.

It truly is a win-win. Take a good hard look at the kind of people complaining or trying to paint this tax bill as "bad" or "dangerous". Consider the source!

You are forgetting this is all paid for by a 1.5 trillion dollar increase in the deficit.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#159

Post by relics443 » Tue, Dec 05, 2017, 9:11 PM UTC

Idk. I'm a high income tax payer in a blue state. According to my calculations, I'll be paying less taxes next year.

In fact, according to my calculations, almost every one will be paying less, except a miniscule population that will have their taxes raised by a couple of hundred per year. And even that might get legislated away in the conference.

Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers

#160

Post by jartelt » Tue, Dec 05, 2017, 9:11 PM UTC

hcknwscommenter wrote: post #77

jartelt wrote: post #23

Overall this bill seems really, really bad and poorly implemented (and costly). But as a renter in the bay area, I do like that increasing the standard deduction and reducing some of the other popular deductions will decrease the large tax break homeowners have been receiving. In my opinion we have been treating renters unfairly by letting homeowners deduct so much mortgage interest, property taxes, etc. We already i…

If owning real estate becomes more expensive, there is a very high likelihood that rents will increase rather than decrease.

I do not believe anyone knows conclusively whether getting rid of those deductions will increase or decrease real estate prices. If the benefit of the deductions was already built in to the price of real estate, prices should come down if you remove the deductions. If removing the deductions limits the supply of homes for sale, prices could go up. My rent is going up every year as it is, so either way I would rather have a more level playing field between renters/owners.