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

nytimes.com

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

#191

Post by refurb »

hcknwscommenter wrote: post #145
TheAdamAndChe wrote: post #100

Earlier quoted context omitted.

Both states still recieve the same benefits from the federal government, it's mostly just demographic and economic differences that cause different states to receive different amounts of aid. Or do you really think West Virginians, who are mostly poor, should receive exactly the amount as New York, who is much more rich overall?

You think it's just an accident that the rich states are high tax? No, the rich states have done much more to invest in education, safety nets, and regulation (work place safety, environment, police activity, etc.). That is why they have better economies. This tax bill just takes a look at all that investment and says: nope.

That is why they have better economies.

That's a bit of a stretch, no? The EU has higher tax rates than the US coastal states and their economies generally lag the US.

And Texas has been one of the fastest growing states in the US, yet has some of the lowest taxes.

Should I go on?

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

#192

Post by refurb »

smsm42 wrote: post #185
munk-a wrote: post #149

Earlier quoted context omitted.

You're missing one even more heinous point, renters. A family paying off their 300k mortgage is getting a decrease in taxes owed while being subsidized for paying into an asset. The renting family is not being subsidized and they will never again see the money they are spending on rent. In most areas this is particularly twisted as mortgages will run beneath rental costs for the same standard of living. So the only r…

> The renting family is not being subsidized Guess what happens to rent if cost of ownership rises due to interest not being deductible?

My guess is housing prices fall and rents follow?

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

#193

Post by akhilcacharya »

hcknwscommenter wrote: post #158
sergiotapia wrote: post #112

Earlier quoted context omitted.

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.

Deficits only matter if the other party is in power, obviously.

I'm old enough to remember when we couldn't afford the stimulus and auto-bailouts when we were in recession, even though the economy is currently chugging along well at near full employment.

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

#194

Post by dragonwriter »

dv_dt wrote: post #190
ghouse wrote: post #85

Earlier quoted context omitted.

Two separate issues -- State and Local Taxes (SALT) are income, property and other taxes collected at the non-federal level. They have been deductible since the creation of the federal income tax. In part, because the federal government recognizes that resources are more efficiently allocated locally. And that is one reason why higher taxed states pay more into the federal government's budget than they receive in ben…

The mortgage interest deduction is a way for home owner/occupants to get cost parity vs landlords who could own the exact same property at a lower cost because the interest of a loan is a business expense. Under the proposed tax cut, it could very well be cheaper for two neighbors to own each others houses and charge one another rent (collected via pass-thru corporations even) than it would be for them to own and liv…

> Under the proposed tax cut, it could very well be cheaper for two neighbors to own each others houses and charge one another rent (collected via pass-thru corporations even) than it would be for them to own and live in their own houses with the same mortgage terms.

Morw to the point, normal homeowners who have trouble with the setup cost of such an arrangement would pay higher taxes to subsidize the rich, who do not have trouble with the cost of setting up such a tax avoidance scheme.

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

#195

Post by mullen »

TheAdamAndChe wrote: post #118
mullen wrote: post #106

Earlier quoted context omitted.

We do subsidize poor states. You speak as though Red states contribute anything to the federal government. With the exception of Texas, Georgia and some oil rich states, all of the Red states are takers and just about all of the Blue states are givers.

Red states also tend to have a lot more poverty and less economic development. Why should rich areas of the country receive just as much federal aid as poor areas? It makes sense that different states receive different aid.

They don't. For every dollar we send the Federal government, we (California) gets back 88 cents. Mississippi gets something like $4 for every $1 it sends to the Federal government.

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

#196

Post by irrational »

davidjnelson wrote: post #58
influx wrote: post #6

So people making over 200K a year will pay more taxes, cry me a river.

You can't buy a decent house in the bay area on 200k.

There are really good jobs (and nice places to live) outside of the bay area.

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

#197

Post by refurb »

SmellTheGlove wrote: post #83
refurb wrote: post #14

Earlier quoted context omitted.

People have been clamoring for more taxes on the rich. Well, this is what it looks like. Oh wait! You didn't think you were rich, right?

> People have been clamoring for more taxes on the rich. Well, this is what it looks like. How exactly is this a tax increase on the rich?

People making more than $200,000 per year will pay more taxes. How is it not a tax increase on the rich?

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

#198

Post by dragonwriter »

hcknwscommenter wrote: post #145
TheAdamAndChe wrote: post #100

Earlier quoted context omitted.

Both states still recieve the same benefits from the federal government, it's mostly just demographic and economic differences that cause different states to receive different amounts of aid. Or do you really think West Virginians, who are mostly poor, should receive exactly the amount as New York, who is much more rich overall?

You think it's just an accident that the rich states are high tax? No, the rich states have done much more to invest in education, safety nets, and regulation (work place safety, environment, police activity, etc.). That is why they have better economies. This tax bill just takes a look at all that investment and says: nope.

> You think it's just an accident that the rich states are high tax? No, the rich states have done much more to invest in education, safety nets, and regulation (work place safety, environment, police activity, etc.). That is why they have better economies. This tax bill just takes a look at all that investment and says: nope.

This right here is the issue: removing the SALT deduction discourages public investment that is a net win before considering the distorting effect of federal taxation, while preserving the deduction means that federal taxes don't have a distorting effect. I've written up a very simplified scenario illustrating this:

https://news.ycombinator.com/item?id=15855955

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

#199

Post by mcbruiser4 »

BeetleB wrote: post #46
mmanfrin wrote: post #5

I'm a highish earning single homeowner in Alameda County (Bay Area) -- between the Mortgage Interest deduction, the Property Tax deduction, and the State Income Tax deduction being slated for removal, my taxable income is about to go up something like $60k, which is a large chunk of my actual income. This tax bill utterly fucks me, to the point I'm considering selling my house to get ahead of the inevitable housing c…

Disclaimer: This bill adversely affects me as well, and I'm not in favor of it, but: >This tax bill utterly fucks me, to the point I'm considering selling my house to get ahead of the inevitable housing crash. Can you imagine any type of reasonable tax reform that would not cause someone's tax to go up? Just the fact that some folks' taxes will go up does not make it a poor plan. If your deductions are about $60K, th…

> Can you imagine any type of reasonable tax reform that would not cause someone's tax to go up?

Yes, easy. Lower taxes for everyone, and also lower gov't spending and entitlements at the same time.

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