47% of US households have no Federal Tax liability

[shawn]

I totally agree iwth the point and the problem here, but I do have to disagree w/ your terminology a bit.
I'd hardly consider a family of four making, say, $65k "rich" by any stretch of the imagination, especially if they're in an urban area.

Sure, rich is relative and all that... but "The Rich" pay the vast majority of income tax revenues. The fat-ass check we have to write next week doesn't amount to a drop in that bucket.

But you're right about the root of the problem being math vs votes. What happens when half of Americans don't pay into the pot for Federal spending, but still receive the services of the Federal government? You end up with a whole bunch of people that are accustomed to getting something for nothing and have no real personal incentive to be engaged conversations about the Federal budget.

 

[Ron]

I'm not sure either of you have been paying attention to this thread.
HALF of all Americans aren't paying any Federal income tax this year. Most states (North Carolina included) now get the majority of their tax revenue from sales tax. I paid 17% in total sales tax on a door handle at the junkyard last week.
As it sits right now, rich people pay income tax. Everybody else is paying various consumption taxes. That goes for illegal aliens as well.

Come on you know me better than to suggest I am not paying attention .

You answered yourr own damn question.
Flat sales tax on EVERYTHING YOU BUY of 12-18%.
No income tax.
Period.
None.

Those 47% who aren't paying just got taxed, because when they buy a 100k house, we just got ~15k. Go out and buy a new Cadillac and finance it 10 years, we get 15% day one, gotta work it in the loan. (BTW same goes for used cars as well)

Want a million dollar estate, thats fine but taxes are due, 150k please.

Next we eliminate social secuity..sure its a rough decae while people die in the streets, but I bet the next generation leearns a lesson...

 

[OnlyOneDR]

I'm still lost at how so many people get so much money back every year. Don't they re-work their W4 to make it close? I am not giving the POS Federal government any more money than I have to. Usually I get a tiny bit back or pay a tiny bit. That's all. All these people that get thousands back need to do their homework.

 

[bfeller]

Right, and the bottom 40% actually get more money back than they withheld.

I don't like that the tax credits means you get more than you put in. It should be that the max of your credits will put you at zero due - not 'refunding' something that you didn't pay for in the first place.

 

[sloop]

Invest that $$$ and file for an extension

Umm, no! I am not sure if you were joking or not. Filing for an extension doesn't let you delay paying what you owe.

Filing an extension just pushes back the date when your return is due, not the date when your money is due. You'll have to pay penalties if you pay later. To quote directly from the IRS:

"Please be aware that an extension of time to file your return does not grant you any extension of time to pay your tax liability."

source: http://www.irs.gov/formspubs/article/0,,id=98155,00.html

 

[RatLabGuy]

I'm still lost at how so many people get so much money back every year. Don't they re-work their W4 to make it close? I am not giving the POS Federal government any more money than I have to. Usually I get a tiny bit back or pay a tiny bit. That's all. All these people that get thousands back need to do their homework.

Well - believe it or not... not everybody has the same income throughout teh year. Big life 9and income) changing things happen... liek losing a job, starting one, moving, buying a house...

for instance, I was right on track to land perfectly even... then in Oct, I started a new job which took me from contracting to full-time W-2 employment. Then (based on that) we bought a house - suddenly that's a huge unexpected credit coming in, etc.

What really pissed me off is that you aren't allowed to wait and file it all at once; if you still owe > 10% of your total liability by april, it's a huge fine. Enough that it prevents doing teh wise thing, and holding it all in interest along the way.
Instead, the Feds get to do that with it.