Super rich see federal taxes drop dramatically

[EvolveOrConvolve]

Source: Yahoo! News

WASHINGTON – As millions of procrastinators scramble to meet Monday's tax filing deadline, ponder this: The super rich pay a lot less taxes than they did a couple of decades ago, and nearly half of U.S. households pay no income taxes at all.

The Internal Revenue Service tracks the tax returns with the 400 highest adjusted gross incomes each year. The average income on those returns in 2007, the latest year for IRS data, was nearly $345 million. Their average federal income tax rate was 17 percent, down from 26 percent in 1992.

...

Eric Schoenberg says to sign him up for paying higher taxes. Schoenberg, who inherited money and has a healthy portfolio from his days as an investment banker, has joined a group of other wealthy Americans called United for a Fair Economy. Their goal: Raise taxes on rich people like themselves.

Schoenberg, who now teaches a business class at Columbia University, said his income is usually "north of half a million a year." But 2009 was a bad year for investments, so his income dropped to a little over $200,000. His federal income tax bill was a little more than $2,000.

Read more: http://news.yahoo.com/s/ap/20110417/ap_on_re_us/us_no_taxes

[MichiganVote]

1. Revolt time

[Betty]

2. $2000 tax on 200K?

what is that , like1/10th of one percent? I make less than a quarter of that and pay more than $2000.

[bettyellen]

3. one percent! nice to meet another Betty- I tried to get your screen name years ago!

[skepticscott]

4. Well, the article says that

"His federal income tax bill was a little more than $2,000". It's not entirely clear whether that's the TOTAL amount he paid in federal taxes for the year, or the additional amount he had to pay when he actually filed his return, on top of what had already been deducted from his salary.

[plumbob]

9. It's his total. From the OP:

"I simply point out to people, `Do you think this is reasonable, that somebody in my circumstances should only be paying 1 percent of their income in tax?'" Schoenberg said.

1% of $200k is $2k.

Check out United for a Fair Economy:

A century ago, tax policies adopted during President Teddy Roosevelt's administration were guided by sound principles that stand in direct contrast to those of today’s Republicans.

“No man should receive a dollar unless that dollar has been fairly earned,” explained Roosevelt in a 1910 speech. “Every dollar received should represent a dollar's worth of service rendered--not gambling in stocks…I believe in a graduated income tax on big fortunes."

http://faireconomy.org/enews/fair_taxation_means_more_brackets_up_top

[freshwest]

37. Thanks for the great link. But will the baggers still support their masters?

[ananda]

13. Yeah..

I made slightly over a quarter of 200k and paid about 8 or 9k.

[LibDemAlways]

25. Due to very strange circumstances last year

spouse and I had an unusually large adjusted income of 169K. Paid $32K to the feds - not to mention another 11K to the state. It's criminal that corporations and the very rich are getting away with not paying their share.

[FloridaJudy]

46. I make a tenth of that

$20,000, and I owe the IRS $1,400. That's three times what I paid last year, although my income is the same. There's no way I can pay that right now. I'm going to have to throw myself at their mercy, and hope we can work out a payment plan.

Something is truly rotten here.

:-(

[ThomCat]

52. I had to pay almost $8,000 in income taxes for a year in which

I was on public assistance for half the year! It is incredibly offensive and should be criminal that we pay so much more in taxes than the wealthiest people who can truly afford to pay their taxes.

For decades they have been paying representatives, paying officials, and paying political parties to change the rules so that they get special treatment. They have been paying what they claim aren't really bribes so that they get lower tax rates, and tax loopholes, and tax havens and tax shelters.

They have been buying influence to make sure that there is almost no effective enforcement of tax laws against the wealthy, and when there is a dispute the wealthy are able to out-gun and overpower the IRS with heavy-hitting armies of tax lawyers. They have made sure that enforcement has been moved to poorer people who can't fight back, so that when all the legal ways of evading taxes aren't enough for them they can avoid taxes in illegal ways too, and be almost certain that they'll get away with it without any penalty.

"Only little people pay taxes." :grr:

[No Elephants]

5. Meme from TV's "Sunday Morning" this a.m.: The real tax losses the U.S.. is suffering are from

unreported income (think things like wait stafff tips, household help, and so on.) We were even told exactly how much less our individual tax burden would be if all these lower paid people reported all their income.

Here's my question: How do we know exactly how much goes unreported?

Here's another question: What's the point of telling me that in the middle of a story about how the rich {legally} pay so much less of a percentage of their income than do low earners? I mean, we know how to change laws to require higher earners to pay more, but we don't seem to know how to end underreporting. Is your point that we should do nothing at all?

[DBoon]

50. waiters (male and female) work very hard for their tips

they can refuse to pay taxes on them and I am perfectly fine with that

There are so many working for minimum wage plus tips that whatever they get in tips is OK

[beac]

56. Actually, most wait staff are paid much less than the minimum wage hourly--

often refereed to as "waitresses minimum wage"-- about $2.50 an hour. The idea is that the tips will bring their hourly up to and over the required minimum. Some days it does, some days it doesn't.

Most restaurants require waitstaff and bartenders to report 10-15% of their sales in tips. Again, sometimes that means they are putting down for less than they actually got, but most of the time it's about right b/c, sadly, there are a lot of shitty tippers out there.

I worked in the restaurant business for years, doing everything from cooking to waiting to managing and I can tell you that restaurant workers are not getting rich on unreported tips. That argument reminds me of Dick Cheney claiming that the economy was doing super-terrific b/c of all the money people were making on ebay.

And the tax on whatever percentage waiters/bartenders are currently not taxed on is a drop in the ocean of tax-free cash washing over GE and the super-rich.



And, thanks for recognizing that waiting tables is, indeed, hard work. :applause: Even though I am no longer in the biz, I always appreciate a customer who "gets it."

[bertman]

60. That meme is a smokescreen but there is a huge underground economy that

does business 'under the table'. I know people who work in the building trades who do work, have employees, but pay cash payments and underreport their income and payments. They've been doing it for years and have never been audited.

That said, I have also known some who tried to get away without filing the withholding on their employees, but who got caught and got busted. The other group far exceeds that group, though.

We will never know how much goes unreported or underreported, but we could sure as hell pay more IRS agents to do more work uncovering the cheats. Oh wait, we just cut the budget for IRS agents.

As a business owner who does it all 'by the book', this really pisses me off.

[primavera]

6. Pardon me while I vomit

Apparently our tax policies have become so unfair as to sicken even the uberrich beneficiaries of those policies, yet Repukes continue to demand lower and lower taxes on them. The mind simply boggles.

[freshwest]

38. Don't worry. Understand that the rich found favor in His eyes, so taxing them is going against God.

As far as the poor, they deserve all the trouble they get. They wouldn't be poor if God didn't want it that way. The rich getting richer and the poor getting poorer is divinely mandated.

Thus, to tax the rich is a sin and to help the poor is a sin. This new Dominionist brand of christianity sweeping the country says so, and they're running with all the fervor of the newly converted.

Strange how the new brand fits in with Ayn Rand's philosophy, huh?

[slackmaster]

7. I plan to have nearly zero federal tax liability this year too

I'm not rich, but I'll have a big solar energy credit plus enough medical expenses to bring my tax down to a very low figure.

[LiberalFighter]

11. It requires spending money to make that happen.

I guess people need to figure out how much disposable income they have at the end of the year. Or would have if they didn't spend on items they didn't need.

[JJW]

8. A freakshow

DC is like a poorly run circus. Nothing makes sense anymore. Four illegal wars, record money for weapons of mass destruction, major corporations paying no taxes, record perks and bonuses for criminals who destroyed the world economy, while people can't find employment, and can't afford health care, food, and housing.

[flying_wahini]

48. that's a mouthful

Gawd. I couldn't agree more.

[SpiralHawk]

10. "Too bad about you American suckers. Sneer." - Republicon FatCats (R)

"Bwaaaa ha ha ha ha. Carry the load for us, suckers, and pay our 'fair share.' Bwaaaa ha ha ha ha. Keep watching Fox and listening to DraftDodger Limbaugh. Bwaaa ha ha ha ha. Suckers. Sneer."

- Republicon FatCats (R)

[totodeinhere]

12. Groups like United for a Fair Economy show that not all rich people are evil, which

is the mime that I read here too often at DU.

[nyy1998]

14. +1 nt

[Mister Ed]

18. A good mime is always easy to read...

But some of the memes we read over and over again here on DU are just gross exaggerations.

:hi:

[JackRiddler]

19. Actually, that's probably the "mime" (meme) you too often interpret...

into what you read here at DU. There is a class within the top 1 percent who own most of the non-home wealth and control most of the productive assets and who, as a class, wage economic war on the bottom 90 percent. This is not "evil" (a theological category) but a fact of life those of us in the 90 percent cannot afford to deny. No doubt there are many good people among the rich -- so what? Economy and policy are run according to an ideology that gives everything to them (good or bad) and leaves the majority in debt, wage slavery or poverty, without assets or control. The good deeds of some of the rich don't count against the fundamental injustice and exploitation of the system.

[Overseas]

26. Thank you. Well said.

[freshwest]

39. Some of the enlightened rich have defended the poor, and paid for it with their lives.

I'm sure you know who they were, none of them were Republicans.

However, the outrage is justified when we see how most of them have perverted the political system and plundered the planet.

Not to mention profited off wars. They hang with bad company.

And the poor are complicit by complying. Hard not to do that.

[DemoTex]

15. Better people, most certainly. Beautiful people, most assuredly.

And deserving, undoubtedly.

:sarcasm: :sarcasm: :sarcasm: :sarcasm: :sarcasm: :sarcasm:
:sarcasm: :sarcasm: :sarcasm: :sarcasm: :sarcasm: :sarcasm:

:puke: :puke: :puke: :puke: :puke: :puke:
:puke: :puke: :puke: :puke: :puke: :puke:

[guitar man]

16. Good

Now the rest of us will get all the good jobs we've been promised!

:sarcasm:

[PonyJon]

17. I don't pay any taxes!

Arn't you jelous? Eat your hearts out, turn green. I've not had a job in years, my investments for retierment have tanked. The Goddamned corporations sitting on trillions of retained earnings don't pay more than about 2.5% dividend yeilds (current stock price devided by annualized dividend payout). The dividend yield calculation varies with stock prices. The lower the stock price the higher the dividend yeild looks. It's all smoke and mirrors and on top of this they pay little to no Federal Income Tax, they do payoff congressmen to get their preferential treatment. If my house was worth anything anymore I would sell it as fast as I could and move to a Socialist country, even Cuba would be a paradise compared to this BULLSHIT FIRST and FOREMOST country.

[freshwest]

40. Just walk away from the mortgage and move where you heart desires. Seriously.

Don't stay in this Babylon system if you don't have to. Some have to.

[JackRiddler]

20. "Half of people don't pay income tax" -- a lie by omission.

Most of the people in that half pay payroll tax. Supposedly to get pensions and health care in their old age. However, these taxes accumulate as surplus above what is paid in Social Security and Medicare, and over the last 30 years have been used to finance the deficits caused by lower income tax on the rich and expenditure on war and military. There are those who hope to never pay back what the regular budget borrowed from the SS and Medicare and other surpluses. They're the ones complaining about "entitlements."

[Overseas]

27. Thanks again. +1

[Yo_Mama_Been_Loggin]

21. Yet Paul Ryan and the GOP want more wealthcare.

Maybe we need to bring back the guillotine.

[BobbyBoring]

22. And fuck face Eddie Munster aka Paul Ryan

Thinks they're paying too much. He was on Face the Nation this morning and it was sickening. He was asked about Obamas comments about him and said "I could address these points one at a time but I won't", meaning he can not justify his hypocracy.

This fucker want's to lower the highest rate to 20% and says it not a tax cut. Why the dimmest of the dim can't see through these cheese balls amazes me.

[Frank Cannon]

57. While the rest of us sacrifice, many with our lives...

these greedy pigs have never had it better.

[Yo_Mama_Been_Loggin]

23. I made 70K last year

Yet my income taxes were 4.5 times that of Mr. Schoeburg.

[mike_c]

24. yup, that's about right for me, too....

Obscene, isn't it?

[EvolveOrConvolve]

28. I had gross adjusted income of about $48k for 2010

And I still paid 3 times as much as Mr. Schoenberg.

[suzanner]

30. Likewise, I made ~40k and pd 2.5x's what Schoeburg pd

And wage slave is the correct term.

[grahamhgreen]

29. NEVER should have passed the Bush tax cut extensions - assinine.

[destes]

34. yes! and if this is Obama's

"chess game" approach to political diplomacy then I'd say he needs to move a pawn next time instead of his knight.

[P. Galore]

31. Over 80% pay more in payroll taxes than income taxes. nt

[kestrel91316]

32. ZOMG, those poor babies!!1!!!11!! They shouldn't have to pay any taxes at all.

Stop being so mean to the Two-Percenters, America!!

[Odin2005]

33. Guillotine time!

:grr:

[Faygo Kid]

35. I was going to post this, but was beaten to the punch. You say you want a revolution . . .

I say, hell yes. Enough is enough.

[truedelphi]

36. And if Matt Taibi is to be believed - then many of those Super

Rich have made millions on government Bailout Handouts.

What is especially disgusting about some of these handouts is that they are not given to those who have devised a decent business plan, but again, if Taibbi is to be believed, to those who are decent trophy wives of Goldman Sachs insiders.

[freshwest]

41. Yes, that story was particularly galling. No more so than BP walking away from the Gulf of Mexico...

With record profits. I could list more, but I'm sure you know already.

[EvolveOrConvolve]

51. Taibbi is one of my new heros

Reading his book, Griftopia, made me angrier than I've been in a long time, and really changed my outlook on our pseudo-fascist "democracy".

[truedelphi]

66. My hero too. And I like

Your expression pseudo-fascist "democracy"

I might myself borrowing it, if you don't mind.

[classysassy]

42. He ain't my brother and he is too heavy

I am tired of footing the bill for the wealthy criminals and you should be too.

[progressoid]

43. Angryfuckinkickandrec.

[RUMMYisFROSTED]

44. Decades old news.

[EvolveOrConvolve]

54. But at least someone's reporting it

Even if it's the crappy Yahoo News service publishing an AP story.

[OhioChick]

45. Sickening n/t

[houstonintc]

47. So where are the Jobs?

If we listened to the Republicans and the hard right we should be in a utopia now shouldn't we?

[EvolveOrConvolve]

55. You mean this isn't a Utopia?

I thought scrabbling paycheck to paycheck while rich assholes drive cars worth than my house IS the Utopia that the R's have been pushing for the last 40 years.

[rpannier]

59. where are the Jobs

China, Vietnam, Burma, Bangladesh...

[valerief]

49. But the most important thing in the world is to give rich people more money so that they can create

jobs--in other countries.

[beac]

58. When they were selling "trickle down" they for got to mention the

"and over the ocean" part. Their untaxed money may be "creating jobs", but they are all for Swiss bankers and cabana attendants in Caribbean resorts.

[The abyss]

53. Well colour me shocked! :sarcasm:

Folks - this is about putting paid to the American middle class. TPTB no longer have a vested interest in the base that actually works and believes in the constitutional ideal of what this nation was founded upon. If that isn't obvious in the here and now then you are blind.

Tee Baggers, democrats, constitionalists, republicans, bull moose, etc......

All have a common denominator - we as individuals must see beyond the hyperbole and stand together.

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

[joeglow3]

61. THIS is why people need to quit whining about tax rates

Taxes owed are a function of 2 numbers: tax rates AND taxable income (income less deductions). The bigger issue is tax DEDUCTIONS. You can increase the rate to 100% and if they end up with $10,000 taxable income on $500,000 in adjusted gross income, they still pay shit.

[lostnfound]

62. Kudos to Mr. Schoenberg for retaining a bit of humanity in this selfish culture.

And to others like him.

[leeroysphitz]

63. Maybe now they will finally give the rest of us jobs like they've been promising for 10 years now.

Not holding my fucking breath tho...

[fascisthunter]

64. wanna know why we have a huge deficit? Well, there ya go...

[Grinchie]

65. The Irony is that Obama paid 26% to the IRS this year...

Today, the white house announced what Obama's income and taxes paid were. It was announced like it was a badge of honor, most likely for some perceived political gain, but for me, it further reinforces my belief that Obama is nothing more than a talking head, or good looking face for the political machinery that actually calls the shots.

Personally, I think it shows how lame Obama is. Who in their right mind would pay 26% to the IRS? That is generally the highest tax rate you can pay, and you basically have to disavow any write-offs to accomplish that feat. It's so incredibly unrealistic that it makes me sick to my stomach that this so called president couldn't take the time to reduce his tax footprint, and choose to play the American citizenry as saps by proudly proclaiming that he pays the maximum rate!

Perhaps he thinks this will motivate all Americans to take the easy way out and fill out a 1040EZ without taking any deductions, but I can guarantee him that it's not going to happen.

Perhaps he wanted to singlehandedly make up for the difference for GE Corporation, which paid ZERO taxes on profits of Billions..

This President is truly a pitiful example of a Corporate Political Puppet without any semblance of self preservation or intellect. It's clear he does what he is told, and has embarked down the path of Political convenience without any idea that Rome is burning, the peasants are restless. and they know longer just accept things for face value anymore.

The Ponzi scheme is failing, and Obama fiddles as the country burns to the ground. No matter, just print another Billion dollars, and then shovel it into the black hole of the 3 or 4 wars we have burning right now to destroy it, because we don't want any inflation now, do we?

[hack89]

67. "More than half of the nation's tax revenue came from the top 10 percent of earners in 2007"

More than 44 percent came from the top 5 percent.

Inverted pyramids are not very stable. NY City was hammered by the financial crisis because their tax revenue was so dependent on a small group of high earners. When their incomes went away so did the tax base.

Increasing that percentage is a good thing but there is a danger - more and more eggs are being placed in a smaller basket. In a perverse twist, protecting the income of the super wealthy may become a matter of national importance.