Who doesn't pay Federal tax
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Who doesn't pay Federal tax
| Mon, 10-20-2008 - 10:50am |
I hope that these links will be read, especially by those who keep clamoring about folks who don't pay Federal taxes.
http://www.irs.gov/formspubs/article/0,,id=164272,00.html
http://www.prospect.org/cs/articles?article=tax_baselessness
http://www.msnbc.msn.com/id/24054024

When we are talking tax cut, rates, who pays, who doesn't, who's tax plan is better, we are talking about federal income taxes. At least that is what I always hear.
I'd love to know if there are people that get around sales, payroll, SS, etc... taxes.
What about the taxes corporations pass along to the consumer as an expense of doing business?
(((Government must be shrunk. ))))
Gov't needs to be more efficient.
The first link in your post shows the progressive tax rates. The reason so many Americans do not have to pay Federal income tax is due to deductions and credits that reduce their tax liability to zero. They DO pay payroll taxes, I don't believe anyone claimed they did not, but that's 7.65% total (unless the person is self employed, then it's double), and sales tax and state tax.
The top tax bracket pays the highest marginal rate, some deductions are phased out completely at higher income levels, total deductions are capped/limited and just in case we get them with the AMT to ensure they do not underpay. There probably are some wealthy business owners in the top 1% who manage to keep money overseas or somehow benefit from living off their wealth and not paying a significant share of tax, however the average upper middle class working family does not live off wealth nor own an overseas business enterprise. They pay a progressive Federal income tax that more than makes up for any "break" they get by the social security tax cap, plus they also pay state tax, city tax (if applicable) and sales tax.
http://www.taxfoundation.org/research/show/542.html
http://openlettertobarack.blogspot.com/