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Suspicious discontinuities (2020)

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Re: Suspicious discontinuities (2020)

#61

Post by dragonwriter »

JohnMakin wrote: post #18

I went to school at a relatively late age and started in community college. The school/state had a policy where any independent income earners making less than 35,000/year would not pay tuition. A single dollar over that would require paying full tuition of ~$60/unit or about $750 a semester. One year I worked a little more overtime during the holidays than usual and realized with a week to go in the year that I'd go…

> I have never understood why things like this don’t use some sort of sliding scale, rather than absolute dividing line.

They often do use sliding scales, but that’s more complex (and expensive) to administer, and (because of multiple interacting programs) ends up not actually solving much of anything. Also, because of the way things (including available funds) work, but even ignoring budgeting for the increased admin cost, a sliding scale probably would start stepping down from full benefit where a sharp cutoff is, that would probably be more like the middle of the sliding scale, so if you “barely squeaked in under the limit” on the sharp cutoff version, you’d probably get far less benefit under a sliding scale system.

Re: Suspicious discontinuities (2020)

#62

Post by bluedino »

rwmj wrote: post #34

Also UK VAT. Companies only need to register for VAT when they turn over more than £85,000 in a year. This adds a great deal of extra complexity for running the company. Predictably a lot of companies earn just less than this amount. The graph is worth a thousand words: https://www.economist.com/cdn-cgi/image/width=1024,quality=8... (from https://www.economist.com/britain/2023/04/11/britains-tax-ta... )

One similar thing is getting a 1099-MISC for 'side work' in the USA

For example, I'll do some hands-on work for a former employer. Rack some network equipment, go investigate something, install some hardware...They take it from there, I can bill a couple hours and it's a nice dinner for my wife and I.

However, if I hit a certain threshold ($600?), they will send me a tax form and I'll then have to pay income tax on that money.

Re: Suspicious discontinuities (2020)

#64

Post by UncleOxidant »

We had something like this when we were on ACA one year. I hadn't been working that year, but I ended up getting a job in August and it looked like we were going to go over the income threshold because we have a rental and were getting rental income. I asked the renters to please not pay their rent for Sept-December until January of the next year. They happily complied. We were able to squeak under the threshold, but it was close.

Re: Suspicious discontinuities (2020)

#65

Post by dragonwriter »

bluedino wrote: post #62
rwmj wrote: post #34

Also UK VAT. Companies only need to register for VAT when they turn over more than £85,000 in a year. This adds a great deal of extra complexity for running the company. Predictably a lot of companies earn just less than this amount. The graph is worth a thousand words: https://www.economist.com/cdn-cgi/image/width=1024,quality=8... (from https://www.economist.com/britain/2023/04/11/britains-tax-ta... )

One similar thing is getting a 1099-MISC for 'side work' in the USA For example, I'll do some hands-on work for a former employer. Rack some network equipment, go investigate something, install some hardware...They take it from there, I can bill a couple hours and it's a nice dinner for my wife and I. However, if I hit a certain threshold ($600?), they will send me a tax form and I'll then have to pay income tax on t…

> However, if I hit a certain threshold ($600?), they will send me a tax form and I’ll then have to pay income tax on that money.

No, the threshold at which you have to include the income in your taxable income ($400/yr) is lower than the threshold for the person paying you to provide a 1099-MISC ($600/yr from that payer.)

Re: Suspicious discontinuities (2020)

#66

Post by margalabargala »

lesuorac wrote: post #29
jeffbee wrote: post #12

Earlier quoted context omitted.

Yeah of course, the appraiser is a person who is paid to write down the predetermined number. The US federal government should nuke this industry as part of their crackdown on "junk fees". Either the appraiser serves a legitimate arms-length purpose or their whole line of business should go away.

I think it's really a problem of different incentives. Somebody (A) at the bank does not want to give out loans that are well beyond a properties value. Somebody (B) _else_ at the bank is actually the one giving you the loan and makes money from you getting it. So A requires B to have an appraiser so they can't completely run away writing loans. From talking to some real estate agents, the appraiser will only fudge s…

> An appraiser might agree that the house is worth 750k even if they actually think its 699k but if you try to get a 700k loan for a 350k house they'll write down 350k in their appraisal.

This is kind of the point. The appraiser isn't trying to find the "true value" of the house, otherwise buyers would hire appraisers prior to even offering a bid.

The question that the bank wants answered is, "is this house sufficiently matched to loan amount such that if the borrower defaults, the house can be sold for enough money to recoup the loan?"

And if the answer is "yes", then they write down the number.

Re: Suspicious discontinuities (2020)

#67

Post by bombcar »

sanderjd wrote: post #22
jeffbee wrote: post #12

Earlier quoted context omitted.

Yeah of course, the appraiser is a person who is paid to write down the predetermined number. The US federal government should nuke this industry as part of their crackdown on "junk fees". Either the appraiser serves a legitimate arms-length purpose or their whole line of business should go away.

I could see a third option as a "lemon detector". That is, instead of their output being a number, it would be a binary, intended only to limit downside risk in the worst cases. I think in practice this is indeed the role they play. If I'm "overpaying" by 20%, the appraiser will probably still "write down the predetermined number", but if I'm overpaying by 100% and taking out a mortgage to do it, there's a pretty goo…

That's basically what they do, they're not to find the actual value of the property (that's more properly a tax assessor, perhaps) - they are there to make sure the valuation is "in the ballpark" to what it would liquidate for.

An appraiser will never get in trouble if a bank forecloses on a $500k property and it sells for $450k or so, but they will get in trouble if the $500k property only sells for $200k - they'd need to explain why.

Re: Suspicious discontinuities (2020)

#68

Post by bombcar »

toast0 wrote: post #46
lesuorac wrote: post #25

> It's generally believed that this is caused by a discontinuity in youth sports: > 2. Within a given year, older kids are stronger, faster, etc., and perform better I've seen a few youth ice hockey games and by god it's just unfair; there's a kid like a foot taller than the rest. I'm kind of surprised there isn't some system that buckets kids by size , it can't be fun for the small kids to get elbowed in the neck ev…

If you've ever played Nintendo's Ice Hockey (1988), it's super realistic, and the tradeoffs of big vs little are clear: little guys bounce off of big guys and big guys move slow. My kid is in 12U youth hockey and is a big guy, and yeah, smaller kids can often usually skate around him, but if they bump into him, they fall over, and often he'll get a "big kid penalty" which means he gets a break in the penalty box for…

I think you could bucket by age but have the ability to move kids around.

The problem is that these youth sports can get very competitive, and then people will be tempted to move the bigger kids down to get an advantage.

Re: Suspicious discontinuities (2020)

#69

Post by bombcar »

dragonwriter wrote: post #65
bluedino wrote: post #62

Earlier quoted context omitted.

One similar thing is getting a 1099-MISC for 'side work' in the USA For example, I'll do some hands-on work for a former employer. Rack some network equipment, go investigate something, install some hardware...They take it from there, I can bill a couple hours and it's a nice dinner for my wife and I. However, if I hit a certain threshold ($600?), they will send me a tax form and I'll then have to pay income tax on t…

> However, if I hit a certain threshold ($600?), they will send me a tax form and I’ll then have to pay income tax on that money. No, the threshold at which you have to include the income in your taxable income ($400/yr) is lower than the threshold for the person paying you to provide a 1099-MISC ($600/yr from that payer.)

Don't you always have to include the income even if you don't get 1099'd?

The $400 is only if it's your only income, otherwise plumbers could always charge $399 a visit and never pay tax.

Re: Suspicious discontinuities (2020)

#70

Post by lynx23 »

danaris wrote: post #47
JohnMakin wrote: post #18

I went to school at a relatively late age and started in community college. The school/state had a policy where any independent income earners making less than 35,000/year would not pay tuition. A single dollar over that would require paying full tuition of ~$60/unit or about $750 a semester. One year I worked a little more overtime during the holidays than usual and realized with a week to go in the year that I'd go…

Frankly, because many people think that any kind of welfare or assistance is, at best, a necessary evil—and more often just evil —and they want to make it painful, complicated, and hard to access.

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