Here's a visualization of the changes with some settings.
https://jsfiddle.net/381rkrsq/
The AMT changes are a huge tax benefit, even to those in California. Especially if you're married
Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
241–250 of 275 posts
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#242Earlier quoted context omitted.
Yes. https://en.wikipedia.org/wiki/Imputed_rent
Thanks. I wonder how that would work out in LA where we already have high rents, high houses prices, and lower wages. I don't quite know how much one can deduct off their mortgage in taxes but I would assume the imputed rent would be a similar amount in such a market?
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Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#243I'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…
Define "highish". You'll only get a tax increase if you're making more than 350K.
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#244First, this article would've been much better off using medians instead of means. High earner outliers tend to skew stats like these. Second, it's interesting to see people who were in favor of tax increases suddenly change their mind when it hits them. While I agree that tax cuts for the rich seem unnecessary, some tax hikes for the upper middle-class aren't out of line compared with a Democrat led tax plan. I wonde…
> Second, it's interesting to see people who were in favor of tax increases suddenly change their mind when it hits them. I'm very much in favor of increasing taxes, if that tax increase went to taking care of some societal problem (I don't care what it is, so for the sake of argument, let's just stipulate that it's a problem we both agree needs funding to solve). In this case, anyone paying more in taxes is just sub…
Thanks for the response - I think your thoughts on tax increases are quite reasonable. I agree that it's much harder to swallow a tax increase when it seems as if the money is going towards causes you disagree with, and I also feel that way with this tax bill personally.
Not sure if I understand the double taxation argument though. Say local/state/federal tax is 1%/5%/20%. Without the SALT deduction of any form, you get taxed 26% on each dollar which seems intuitive and fair. I think this model makes more sense than exempting certain amounts of money from each subsequent tax-level, but discounting the actual economic implications, I suppose which model seems more intuitive is somewhat subjective.
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#245Earlier quoted context omitted.
> 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?
> People making more than $200,000 per year will pay more taxes. How is it not a tax increase on the rich?
I'm not sure of that, though, because that only seems true if you're filing single. MFJ at the same income level puts you in a lower bracket than today. I know there are more single filers than married, and that married filers pay close to 3/4 of all income taxes, but I'm unsure if that results in an overall increase.
Besides, this whole tax plan seems to lighten the tax burden on wealth. The estate tax exemption gets larger (and eventually eliminated in the house plan), and the small business tax rate drops to 25% (S-Corps, LLC, Partnerships, Sole Proprietors) - that's almost entirely going to benefit entities used to manage passive income/wealth like PE, hedge funds, etc. The house plan is a little better here since it reduces taxes on small businesses who don't make enough to benefit from the senate version.
Put another way, if this were really a tax increase on the rich, why are we projecting that the deficit (and national debt) will increase as a result? With income distribution the way it is right now, the only way you arrive at the deficit number is to tax the rich less, not more. The issue here is that everyone is getting a tax cut, and that seems unwise to me without some adjustment to spending.
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#246I'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…
California is the insane state with created the taxes. The government is trying to simplify the tax code, that means you should be able to say: "I'm taxed at 15%, and that means out of $100k you get $85k take home" Not all the deductions. I'm not really, for or against this bill. I used to live in Alameda, CA and thought the taxes were insane. The bag tax, the income tax, the property tax, literally if you didn't hav…
Good luck, every single prop aimed at raising the California income taxes passed overwhelmingly. The financial bind of those who make $200,000 and live in SF is not quite shared by voters in San Bernardino, Sacramento or even east LA.
It might also turn out that the pension plans for state employees, teachers, prison guards and police have been underperforming, and unless those pension funds loaded up on Bitcoin at the right time, the California taxpayers are on the hook to make up the difference.
There’s a silver lining, of course - once the high-speed rail is completed, the ticket revenues for the masses excited to go between LA and SF will surely pay for everything.
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#247I'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…
California is the insane state with created the taxes. The government is trying to simplify the tax code, that means you should be able to say: "I'm taxed at 15%, and that means out of $100k you get $85k take home" Not all the deductions. I'm not really, for or against this bill. I used to live in Alameda, CA and thought the taxes were insane. The bag tax, the income tax, the property tax, literally if you didn't hav…
>>Perhaps we should rethink the government being the biggest employer, and actually make taxes simple and uniform.
And pensions.
Pretty much bulk of the tax money collected goes out to pay pensions and various other social security benefits, which people awarded themselves way back in time assuming the coming generations will happily pay for with taxes.
Nobody and nothing can satisfy people who think they are entitled to free money.
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#248Earlier quoted context omitted.
Ok, lets play this game. From now on its renters that have to pay 50% of the property tax. No? But you get to deduct it! an extra deduction for you! whats not to like?!
Renters are already paying all of the property tax. The expenses for any business (including being a landlord) are, in the long term, paid by the customers. Otherwise the business becomes insolvent.
I concede renters may be paying a part of it.
However if a landlord is like a business owner, and property tax is a business expense, why should they not be allowed to deduct it (just like any other business expense)?
Amazon has expenses too related to storing products in warehouses, which they can deduct. Part of that cost is priced into the product. So in theory, customers should be able to deduct a portion of every product they buy from Amazon?
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#249Earlier quoted context omitted.
California is the insane state with created the taxes. The government is trying to simplify the tax code, that means you should be able to say: "I'm taxed at 15%, and that means out of $100k you get $85k take home" Not all the deductions. I'm not really, for or against this bill. I used to live in Alameda, CA and thought the taxes were insane. The bag tax, the income tax, the property tax, literally if you didn't hav…
Good luck, every single prop aimed at raising the California income taxes passed overwhelmingly. The financial bind of those who make $200,000 and live in SF is not quite shared by voters in San Bernardino, Sacramento or even east LA. It might also turn out that the pension plans for state employees, teachers, prison guards and police have been underperforming, and unless those pension funds loaded up on Bitcoin at t…
>>It might also turn out that the pension plans for state employees, teachers, prison guards and police have been underperforming
More like they award themselves pensions that can be funded through these means. For eg: http://www.mercurynews.com/2016/11/01/bart-janitor-grossed-2...
There are many such articles written over the years, including those by Arnold Schwarzenegger, about the impossibility of paying pensions the tune to half a million dollars a year per person, for decades(Given how long people live these days).
Unions graciously award over time to employees to inflate their net compensation package in the last few years(as that is what decides the pensions).
Even productive people, who are at the peak of their performance struggle to make $500K/year. Paying that kind of cash for every single person disproportionate to the value they create/created is possible by only one means- Taxes.
Re: Among the Tax Bill’s Biggest Losers: High-Income, Blue State Taxpayers
#250Earlier quoted context omitted.
Ok, lets play this game. From now on its renters that have to pay 50% of the property tax. No? But you get to deduct it! an extra deduction for you! whats not to like?!
> Ok, lets play this game. From now on its renters that have to pay 50% of the property tax. No? But you get to deduct it! an extra deduction for you! whats not to like?! Renters already are paying a piece of the property tax. It's built into the rent. They just can't deduct it.
Ok that may be true but why should they be allowed to deduct it? They are not a business owner (unlike the landlord). Its like allowing people to deduct 10% of everything they buy from Amazon because they are paying a part of Amazon’s warehousing costs.