Not Joe the Plumber, but SAHM

iVillage Member
Registered: 10-16-2008
Not Joe the Plumber, but SAHM
246
Thu, 10-16-2008 - 10:49am

My Open Letter:

Dear Senator Obama,

I am a stay-at-home mom living in the over $250k tax bracket. I want to ask you why you feel my family is not doing it's part to share the wealth in this country. Our family does well but we also pay taxes at the highest marginal rate. We do not have millions or the kind of lifestyle that would get us access to tax loopholes. We only get deductions for home mortgage interests, state taxes paid and charitable contributions. Last year those three deductions were capped because the government limits the deductions at our income level. In the past we have been stuck in AMT which ensures we do not underpay our fair share of taxes.

Because of our family's income level, our children will not qualify for student loans or other aid. Therefore we must save entirely for their college. We save as much as we can. In recent weeks lost 30% of those savings as well as a decent amount of our retirement savings and the few mutual fund investments we have are under water. The only other asset we have is our family home. We only have one. It would be really tough to sell it in this market, we've lost a large chunk of our equity.

We have never received a stimulus check, yet we do our part to donate to charities we believe in, invest in the market and spend to keep the economy going. And we pay our taxes. There is no question that the opportunities in this great country have allowed us to achieve the American Dream. For that I am grateful.

Your proposals will take an additional 12% out of our annual family budget by increasing the marginal tax rate and increasing payroll taxes. We aren't struggling yet but we will be if your tax proposals pass. We will have to stop or severely limit college savings, with one child only 3.5 years from college and the savings down 30%. Last year we paid enough in Federal Taxes to supply 240 individuals with a Bush stimulus check, similar to the stimulus plan you propose if you are elected (I guess that continuation of the same Bush economic polices is good). I have no doubt that some of what we paid went to wasteful government projects and earmark spending that did not help any struggling families. You say $18 billion in earmarks is not a lot of money to you but 12% of my family budget is a lot to me and my children. I do not begrudge what we already give the government, but I will argue that we are doing our share. I argue we are patriotic and we are neighborly.

We are upper middle class, we are not like your friends, Oprah and Warren Buffet. Our priorities are saving for our retirement, our kids college and paying off our house. We can comfortably do those three things now, though we are worried about the economy like everyone else.

I am a registered Democrat and have always believed in social programs for those who need them. I still believe in them. But I do not understand why when you speak that it sounds as though my family is getting something over on this country. That we aren't doing our part. That we don't pay enough tax. That we don't do enough to lift others up. I say we are doing a lot by not asking anything from the government. I say it is the government that is letting the American people down, not us.

If this economy gets worse my husbands job will be at risk. We could lose our home along with the remainder of our savings. The only good news I see coming from the Democrats is that maybe then we can have the government contribute to our children's college education, we'll get a tax cut and might finally see one of those stimulus checks. Then you'd finally get your chance to lift my family up.

Pennsylvania Mom
http://openlettertobarack.blogspot.com/

Pennsylvania Mom http://openlettertobarack.blogspot.com/

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iVillage Member
Registered: 04-17-2007
Thu, 10-16-2008 - 11:50am
I read that 1/3 pay no taxes in the WSJ article. How is that possible. Where is the link? I paid taxes even when I was a 15 year old and worked at Arbys. Are they counting children or people who aren't working? I would consider a stay at home parent to be paying taxes with their partner but maybe they don't count?



iVillage Member
Registered: 10-16-2008
Thu, 10-16-2008 - 12:01pm
If you read both of their plans in detail you will see both plan to cut wasteful spending, both defense and domestic spending. When it comes to current programs McCain wants to cut back, Obama wants to spend more. When it comes to new programs McCain wants to not start any new programs, Obama wants to spend on new programs too. Obama's plan requires finding more wasteful spending and ripping 12% from my family. McCain's plan expects more government control and budget responsibility without taking more from those who already give the most, invest the most and spend the most. McCain's plan is better for the economy. We don't need middle class welfare programs. The middle class already pays a fair tax rate, the upper middle also pays a fair tax rate. The government is the problem for not taking good care of our current tax dollars.
Pennsylvania Mom http://openlettertobarack.blogspot.com/
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iVillage Member
Registered: 09-09-2000
Thu, 10-16-2008 - 12:01pm
I don't know how they're actually getting the statistic, but I can say the my family has very little tax liability. Between deductions and credits, we usually get back most, if not all of what we paid in federal income taxes. We are stable, middle class and make under $100,000/year. We do, however, pay FICA, sales tax, and property tax. Our situation is not all that unusual, IME.

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iVillage Member
Registered: 10-16-2008
Thu, 10-16-2008 - 12:03pm
They pay taxes but with deductions and credits, when they file their taxes they get a refund and get it all back. On top of that they get stimulus checks and will continue to get those with Obama.
Pennsylvania Mom http://openlettertobarack.blogspot.com/
iVillage Member
Registered: 10-16-2008
Thu, 10-16-2008 - 12:09pm

Exactly. My tax rate is 10% higher than most middle class people. On top of that we pay payroll tax, sales tax, state tax, local tax and a high property tax. Our deductions are capped/limited so we don't get too much of a benefit from paying a lot in home mortgage interest. If somehow we get too much in deductions the AMT ensures we pay enough tax. Obama wants us to pay all that plus 4.6% more federal tax and 4.6% more in payroll taxes.

Under Obama our tax rate will close in on 50% of what we earn, even after our (capped) deductions. That will inhibit investment and spending for those who invest and spend the most.

Pennsylvania Mom http://openlettertobarack.blogspot.com/
iVillage Member
Registered: 07-24-2006
Thu, 10-16-2008 - 12:10pm
I will have to look into it more, but I'm pretty sure you will not have to worry about Obama's $250,000.

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iVillage Member
Registered: 05-06-2007
Thu, 10-16-2008 - 12:19pm

I've already stated that I don't want to get involved in a debate about taxes. I really only posted b/c of the mention of earmarks.


Chrissy
mom to Aidan 8/21/03
Grayson Blaine 12/30/07

iVillage Member
Registered: 10-16-2008
Thu, 10-16-2008 - 12:20pm

What are you talking about? He proposes changing my current rate from 35% to 39.6%. He proposes removing the cap on social security tax for those making over $250,000. How do you propose that won't affect me?

I'm pretty sure we don't get the 401k deduction, we make too much. We get nothing for the kids deduction. We itemize and get home mortgage, state taxes and charitable contributions and then those are REDUCED because there is a cap for people at my income level (that's the opposite of a loophole Obama). Then we have AMT.

Pennsylvania Mom http://openlettertobarack.blogspot.com/
iVillage Member
Registered: 01-12-2008
Thu, 10-16-2008 - 1:31pm

Hi Pennsylvania Mom,

First, I want to say that I appreciate your perspective. I would never call you unpatriotic or unneighbourly. It sounds like you have a great family and you are doing your best to succeed and take care of your kids while being socially responsible too. I'm like you in that my family and I are in an upper tax bracket. We are not above the 250k cutoff, but I expect we will be at some point before long. Currently, we pay a lot in taxes however and having spent most of my youth paying very little if anything in taxes, I can say that it does bite a bit. I just wanted to offer a little of my own perspective here too, and you can take it for what its worth.
I grew up in a lower-middle class family. My dad is a school teacher. My mom worked a variety of jobs, whatever she could get. My parents both worked very very hard, and I grew up learning that you have to work hard to earn what you want. Despite working very very hard, my dad will never earn as much money as my DH and I do. In fact, I think my dad works harder than I do and has been in his job for 25 years and I make about the same amount that he does. For our society to function, someone has got to take the job as schoolteacher, garbage collector, plumber. Not everyone can be in the high power jobs that make a lot because society would just fall apart. Now, I do concede that there are some people in the lower and middle classes who just can't get it together. I am related to some of them as well (uncles and cousins); but my point is that for many people, the American Dream doesn't mean being Bill Gates, it means working hard and in return, having enough to take care of yourself and your loved ones. For many people, that American Dream is just not happening, despite their best efforts. My parents could not save any money for me to go to college, and I was told when I was 13 that it was very important that I work hard in school and try to get scholarship money. Fortunately, school came very easily to me, and when I added hard work on top of my natural talent, I got a full scholarship to college and went on to get my PhD (also on a scholarship).
I do feel that with great power comes great responsibility. I use my money to help out my family in lots of ways, especially as I have a sister who suffers from pretty severe mental illness and needs treatment that my parents cannot afford. I am NOT saying that there is not waste in government or that government is not imperfect, only that I do think the people we elect into office for the most part have good intentions and want to use our money to help people. Socialism is not communism, and its not evil. It is really a very nice idea at its core that is consistent in many ways with the American Dream. I do think it should be applied in moderation.
When it comes down to it, even paying a ton in taxes, I have way more money than I really need. I am willing to pay MORE than my "fair share" because I have had WAY more than my fair share of talent and luck.
I wish your family the best through this economic crisis and I hope that you won't be hit as hard as you fear.

Best,
Bridgette




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iVillage Member
Registered: 07-24-2006
Thu, 10-16-2008 - 1:33pm

What?

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