Doing my first (and maybe last) client tax return. 47 forms and schedules. 47. How ridiculous has the tax code gotten?
Question of the Day, Feb 8
Doing my first (and maybe last) client tax return. 47 forms and schedules. 47. How ridiculous has the tax code gotten?
Hate to pimp here. But this proposal excites me. Interested in your opinion, mike. The idea of S-corp flow through being taxed at 15% is an idea I particularly like. https://www.donaldjtrump.com/positions/tax-reform
Want to hear a real screw job:
Being 66, my wife and I are collecting full SS benefits. I also work full time as a software developer.
Here’s the governments quadruple dip:
I paid over $15,000 in FICA in 2015 – what you have to pay in – when you’re entitled to collect.?
FICA contributions are taxed.
Our SS benefits are subject to Federal Income Tax.
Our SS benefits are subject to Minnesota Income Tax.
I’m fortunate to be a high income earner, and I don’t mind ‘contributing’, but this is an ass rape.
There used to be a common principle in law that when the law is complicated that the common reasonable man couldn’t be expected to understand it the law should not apply to him beyond the extent that actually could reasonably be expected to be understandable.
Still is to some extent, but usually only when a Judge finds himself bewildered by it as well.
That principle, obviously, doesn’t and never has applied to tax codes. They are beyond such legal principles and you will be held to them no matter if even their makers and enforcers don’t understand them either.
Star, like it, except the 0 tax under 50k. People should have to pay something, then they give a shit where it goes.
PA Mike,
I didn’t like Trump’s idea for “no taxes on couples <$50k" either until it was pointed out that it's hardly worth the paperwork to collect the miniscule sums they pay. Trump would exclude income from single filers only to $25k. He would keep deductions only for charity and mortgage interest. Few have picked up on this, but excluding state & local income taxes (including property taxes) would arguably "hurt" those of us in high-tax states (although it'd be offset by lower rates) relative to those in low-tax states. So rather than effectively subsidizing high tax states (by allowing their taxes to be deductible when computing federal income tax), states would be incented to keep their overall tax bite low. That's a big change and a logical one.
NI read through the 70K tax code a few months ago . Page 247 and 11,418 applied to me an the wife . That means for the average person 69,998 pages are for too big to fail groups .
In seriousness. My wife and I pay 31.4% in taxes on an income under 100K . Here’s the breakdown
1) Federal Effective Tax Rate : 9%
2) State Tax Rate: 7%
3 SSI Taxes : 6.25 % a piece… 12.50 % Total
4) Medicare Tax” 1.4% a piece..2.9% Total
We don’t owe anything on the house,no credit cards,no car payments etc. Unless I get sick again we don’t have medical deductions ….so we fill out the short form.
Hi Buckhed –
You need an accountant.
You do not pay 6.25 * 2 SSI – just 6.25. Doh! In other words, 6.26% times 50 k plus 6.25 times 50k = 6,250. not 12,500. So you pay 6.25 on the total amount.
Same goes for Medicare tax. 1.4% only. Not 2.8.
No need to thank me.
LLPOH…6.25 comes out of my check and my wife’s check each … so does medicare…DOH !
DOH…I hate when I respond in haste…LLPOH..you are right . Got a good accountant ?
Dutchman says: Want to hear a real screw job:
Being 66, my wife and I are collecting full SS benefits. I also work full time as a software developer.
———————
Dutch, why didn’t you defer SS to when you retire? You get a bigger SS monthly payment every year you defer past your full SS retirement age.
Buckhed – no problemo.
I live and breathe numbers. It is the world I live in.
Mike, down here everything you own has to be buried under a pile of LLCs, the lawyers are just too thick, and keeping them busy is built into your insurance premiums. The idea or getting back to simple corporate structures, c-corp or s-corp, and having that income taxed at 15% would be an enormous incentive to start ups. Trump wants to downsize the IRS, easiest way to do that is to minimize contact with the citizens who cost more to process than they pay in. I too like the idea of everybody paying something, but a smaller IRS is a more desirable outcome.
If your charitable contributions are subsidized by tax breaks, are they still charitable?