Trump Tax Plan Looks Like Pile Of Hot Garbage - Another Giveaway To The 1%
I typically don't take on general politics on my blog, preferring to avoid the hot-button topics they tell you to avoid at cotillion (primarily, religion and politics).
Nevertheless, I know a giant pile of crap when I see one, and this "tax cut" certainly stinks. That is, unless you are already a member of the ultra-privileged class - then it constitutes a substantial pay raise.
First things first - revenue effects.
The Tax Policy Center reported today that the tax "cuts" in this package will cost $2.4 trillion over the first decade, and $3.2 trillion over the second decade.
I suppose we're already using this strategy, so we may as well double-down.
The Tax Policy Center also reports that the bottom 95% of earners can expect a "0.5% to 1.2%" increase in after-tax income owing to a combination of an increased standard single deduction and an upgraded child tax credit.
So, what is the cost for such magnanimous handouts for us plebs?
Merely a middle-class tax hike, and an increase to top-1%'ers after-tax income of 8.5% (50% of the total "benefit" from the new plan.)
Finally, the repeal of the state and local tax deduction is likely to be widely reviled, particularly in the Democratic states with higher rates of these taxes. This is likely to fall upon homeowners, in particular, which is great because we apparently don't have enough millennials already living in our parent's basement.
It's only not an F because I can imagine something far, far worse.
Constructive Suggestion: %@#$, what can I say. Game theory says keep printing until it blows up in your face, then cut spending until taxes fully fund government to re-establish credit. Any attempt to logically "suggest" reform is pointless.
Actual Suggestion: Extend every entitlement to 100% of citizens until we're broke. I want an iBama phone, too.
Boo. Booooooo.
We also have a Radio Station! (click me)
...and a 4800+ user Discord Chat Server! (click me)
Sources: Tax Policy Center, Zero Hedge, BaconsRebellion.com
Copyright: Waste Management, Jurassic Park, Calvin and Hobbes, The Simpsons
Nice catch regarding potentially removing state income tax deductions. The removal of the state income taxes deduction may kill the itemized deduction, once the standard deduction is tentatively raised to $12,000 (or $24,000) for a married family. I believe it is renters that will find the increase to the standard deduction beneficial (they typically won't itemize deductions as there is typically not mortgage interest or real estate tax). And homeowners will pay for it through the mutilated itemized deduction.
Without giving up the secret sauce to every point in my series, well here's another zinger - the personal exemption is consolidated with the standard deduction so it's definitely not as good as it sounds for the "middle class tax cuts."
On the other hand, more folks will be able to take child tax credits, and even there is a credit if you are for caring for a child who isn't your son/daughter.
Thanks for the deeper analysis.
"I believe it is renters that will find the increase to the standard deduction beneficial (they typically won't itemize deductions as there is typically not mortgage interest or real estate tax). And homeowners will pay for it through the mutilated itemized deduction."
I agree with your assessment. Apparently, someone has decided that home ownership rates are not trending down hard enough.
"so it's definitely not as good as it sounds for the "middle class tax cuts."
It never seems to be...the middle class, what's left of it, is pretty much a tax donkey at this point.
"and even there is a credit if you are for caring for a child who isn't your son/daughter."
I'm sure that won't be gamed at all...
Thanks for edumacating me about this incipient horror. I had essayed to avoid spending any more time learning why I had to revile it than absolutely necessary, and you have been instrumental in my meeting that goal.
Thank God for barter! Or have they figgered out how to tax that yet?
I do appreciate your attention, and post on this matter that you generally would avoid.
Thanks!
"Or have they figgered out how to tax that yet?"
Hah, they do tax barter, at the "fair market value gains" or using other vague terms.
However, the good news is their taxation strategy relies mostly on self-report.
In other words, most small-fry can kind of ignore it.
It's a bit like (not) reporting your sales tax savings from Amazon.
Hell, the IRS even tries to tax the goodwill of your company, if you'll let them.
https://www.irs.gov/businesses/small-businesses-self-employed/intangibles
"Intangible Property is property that has value but cannot be seen or touched. It includes things such as: goodwill, business books and records, a patent, a license..."
goodwill...couldn't believe this crap when you showed me in your taxes post
One of the easier taxes to "avoid", thankfully. Just anger your customers temporarily every December/April.
I searched the internet for an easy to understand illustration of how this tax plan works. I hope this helps us all better understand this new tax code and how much it will help all people!
Hah, that's a good one. I think my dogs would do this. They aren't allowed to eat until I say, but they seem to think once I do, they can eat just about any target.
luv your dogs but that doesnt always stop them
The management is aware of your complaint and asks that you please bear with us during these renovations.
lol
I havent read much into the plan.... but it doesnt seem to have equal cuts to government..... i support tax cuts of all colors to all and any persons..... but i dont care much for more government debt
" i dont care much for more government debt"
Me neither, but at this point, that would seem inevitable.
One thing I learnt while working in the public service....
....if it 'aint broke then it dont get fixed. Which gets logically extended to - if you want to make change, reform or improve something that is going to meet budget or constituent resistance (ie, be unpopular)....you need to break it first.
Praise be! Have you heard the good word about our saviours gold and silver?
"you need to break it first."
Ah, yes, the "ObamaCare" strategy!
"Have you heard the good word about our saviours gold and silver?"
Yes, but I traded them in for these digital newcomers I keep hearing about.
ouch burn.
that trade paid for this house.
ObamaCare is just the most recent high profile example, but this has been going on for a long time.
I admit I stopped buying PMs when I got into cryptos but they're still a very useful diversification that remains outside the system. I expect them both to do well when the music stops.
"I admit I stopped buying PMs when I got into cryptos but they're still a very useful diversification that remains outside the system. I expect them both to do well when the music stops."
Same here, on both counts. I do think Crypto is the closest thing to Gold since....Gold. A lot of technologically un-savvy people could still do rather wel if they decide to hold Gold long-term, but it's become too idle of an investment for me. Does nothing and requires storage.
LOL
It's times like these I envy silver spoon manufacturers.
Not really. I got shit to do =p
It sure is something that they can pump this tax cut to sound so great for the middle class. I used to be a strong believer that if you want to change the system you have to vote.
That theory was thrown out the window because the people I vote for that win flip-flop in a New York minute!
Yeah, I'm afraid to say I'm of the opinion that voting is not of much use anymore. I don't really have a good alternative, though.
How about simply ignoring them until they go away? It is our participation in their scheme that renders it functional. I am growing to believe there are nascent mechanisms to better serve all the functions of government, propaganda mills (er.. content creation), and fractional reserve banking.
It has been a hard slog, I admit, but I have not had a bank account for over seven years now. While I also have not cared to invest my time and attention towards superfluous wealth, and been satisfied that my minimal needs are met, I have also discovered a wealth of goodwill that I previously never suspected existed.
Government is a bit thornier issue than finance, as bankers tend not to force loans on you directly, with weapons drawn, relying on the second pillar of the unholy triad of social control, government, to do that.
The third pillar, propaganda, we have here found the solution to.
Never put off until tomorrow what you can just ignore permanently.
Yours is a path few have the stomach for. Also, for those of fewer talents, a job that doesn't require a bank account (or check-cashing scam-outlets) may not always be feasible.
I can only concur with the rest of what you've said. People do not opt out of taxes because taxes are collected at the barrel of the gun, "from which power flows forth."
off the grid easier said than done. ive tried, hard to rent and lease
Oh yes, I'm well aware of the issues on that front in the past...
The truth is, you are basically removing yourself from the society when you go anti-fiat/bank/grid/whatever. Living as an outcast is never easy.
tell me about it...
The system right now is so tight, everyone hoping that something gets pass and some money could really trickle down, I haven't really done any reading on the present tax proposal but judging from what you written, it seems like an f-u to the common man and thumbs up to those at the top of the pyramid
Much like most tax plans before it, I'm afraid.
They should just add in "Let them eat cake" into the bill. mmm cake.
Thanks for sharing ,
Upvoted !
By the way ,I started following you and I would appreciate your follow back too .
please visit my blog and vote me too
Its so exciting to be on the ground floor. I think most people don't realize how lucky we are to be a part of this as a community. Things of this magnitude are usually only available to the elite. If the power of the community could be harnessed the growth could be exponential
Thank you. I hope you are correct at the end there.
... when you start with garbage, you end with garbage...
Garbage in, garbage out.