wealthy benefit most from tax subsidies

iVillage Member
Registered: 09-15-2008
wealthy benefit most from tax subsidies
137
Wed, 09-22-2010 - 9:25pm


(Reuters) - Billions of dollars in U.S. tax breaks to encourage home ownership, retirement savings, business start-ups and education mostly benefit top income earners and do little to help low- and middle-income people build wealth, a report released on Wednesday said.

full article:
http://www.reuters.com/article/idUSTRE68L3WP20100922

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iVillage Member
Registered: 09-01-2010
Wed, 09-22-2010 - 9:50pm

From that article:

<<<<

"We can ill afford a federal wealth-building strategy that primarily helps those who are already wealthy," the report concludes. "Redirecting the federal dollars spent on building assets more equitably would not only help poor families gain a foothold in the economy, it would fortify middle-class households," the report added.

Levere said one way to encourage more people to save would be to expand a tax credit aimed at encouraging retirement savings for middle- and low-income people.

As it stands the amount of the credit depends on taxable income, she said. Making it refundable for those who do not earn enough to pay income taxes would encourage more people to open accounts.

"By making it refundable, you go from helping six million families to helping 50 million families," she said.>>>>>

~Opal~
~Opal~    
iVillage Member
Registered: 09-22-2010
Wed, 09-22-2010 - 10:22pm

why would the wealthy want to help the low and middle class????

iVillage Member
Registered: 07-15-2010
Wed, 09-22-2010 - 11:53pm

The wealthy don't qualify for many of those type benefits. There are certainly some benefits that favor the middle class over the lower income or the wealthy.

As far as direct subsidies go though, those who pay the least get the most in return and those who pay the most get pretty much none of those subsidies. There was a recent report posted her not long ago which gave the breakdown.

>>Luck is what you call it when preparation meets opportunity<<
iVillage Member
Registered: 07-15-2010
Thu, 09-23-2010 - 12:05am

Misinformed researcher or purposely misleading:

Fact:

The mortgage interest deduction allows taxpayers to subtract the interest they pay on their home mortgages from their income. This results in a tax break to homeowners who are able to take this deduction. The deduction phases out at higher income levels, providing a greater tax benefit to lower- and moderate-income earners. Although simple in concept, in practice the phaseout rule is complex.

And I also read this: >>The CFED is a group with a bias for low and moderate income families. The headline is a sound bite. The study if you read it defines wealthy as those making more than $160,000 per year and "the top fifth -those with incomes greater than $80,000 - received 84 % of the benefits". The benefits were defined as home mortgage deductions, property tax deductions, and preferental rates on dividends.<<






Edited 9/23/2010 12:12 am ET by gripcon
>>Luck is what you call it when preparation meets opportunity<<
iVillage Member
Registered: 09-22-2010
Thu, 09-23-2010 - 12:34am

You know what I make way less that 160 - I'd be willing to give up my mortgage deductions for the rest of my life

iVillage Member
Registered: 08-16-2005
Thu, 09-23-2010 - 6:09am
Thanks for clearing it up...I was about to post the study of those that benefit most you were speaking of....also the 60% of the spending that goes to our entitlements....








iVillage Member
Registered: 08-16-2005
Thu, 09-23-2010 - 6:11am

Why don't we all just give up our interest deduction...or all give up the tax cuts.


iVillage Member
Registered: 09-15-2008
Thu, 09-23-2010 - 9:02am

<>

as your recent thread on here suggest, the term "wealthy" is relative.

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yes, and thankfully the article was very clear as to what benefits it was referring to.

<>

i must have missed that, i will look for it when i have the free time

iVillage Member
Registered: 09-15-2008
Thu, 09-23-2010 - 9:12am

<>

what yrly income numbers are you using to define lower and moderate income earners?

<>

where did you read this from? i put it in google an nothing came up. i have to run to work so i dont have time to browse the internet for your source. also, as mentioned, the term wealthy is a relative one.

Avatar for jbgattuso
iVillage Member
Registered: 04-29-2003
Thu, 09-23-2010 - 9:52am

Here is the thing,



I don't really put much weight in the numbers that many sources put out there because I know that the amount of money that we make qualifies us as "wealthy" and the only one of those deductions that we receive is the mortgage interest and that was because we purposely got a large mortgage to hit that number, alas, it was the WRONG decision on our part.

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