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View Diary: Harry Reid rips John Boehner for skipping town as tax hikes loom (117 comments)

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  •  The income tax bite is basically $37.50 a month (4+ / 0-)
    Recommended by:
    bear83, Frank Palmer, marzook, dfe

    for most workers, caused by the expiration of the 10% marginal bracket. For the median earner, the FICA expiration is ~$65-$70 a month.

    (That's $450 a year for income, $800 a year for FICA, FWIW)

    So you've got the importance of the two reversed.

    The FICA holiday needs to end (as all holidays must), but it should be a phased ending, and not coincident with a simultaneous income tax increase.

    All else being equal, I'd like to see all the income tax rates revert, with the exception of the 10% bracket.

    Non enim propter gloriam, diuicias aut honores pugnamus set propter libertatem solummodo quam Nemo bonus nisi simul cum vita amittit. -Declaration of Arbroath

    by Robobagpiper on Thu Dec 27, 2012 at 08:39:16 AM PST

    [ Parent ]

    •  Quite right (1+ / 0-)
      Recommended by:
      Robobagpiper

      For most people the SS bite is larger than teh income tax bite. (46% of the population doesn't even pay income tax, although I don't know whether this change will affect that number.)

      The income tax gets (somewhat) more money, but that is becasue it is levied on the high-income individuals who get a  much larger share of the income than their share of the population.

      •  It doesn't change the number who make too (1+ / 0-)
        Recommended by:
        Frank Palmer

        little to pay income tax.

        The primary change for most workers in the Bush tax cuts was that the bottom bracket, which was previously taxed at 15%, was split into two brackets; tax on the first $9000 of taxable income (double that in a 2-earner household) was lowered to 10%, and the upper end of the old bracket remained 15%.

        If the 10% bracket expires, everyone making over $9000 in taxable income pays 5% more on the first $9000, ergo $450 more.

        If you make less than $9000 in taxable income, but more than zero, you pay half again what you previously did in total income taxes, up to $450 more.

        There were more changes to the upper brackets, but they don't affect people until they're well above median income.

        Non enim propter gloriam, diuicias aut honores pugnamus set propter libertatem solummodo quam Nemo bonus nisi simul cum vita amittit. -Declaration of Arbroath

        by Robobagpiper on Thu Dec 27, 2012 at 10:17:39 AM PST

        [ Parent ]

      •  It will hurt the bottom the most (0+ / 0-)

        The Earned Income credit will be gone and the dependent deductions greatly reduced. The elderly will find it hard to get care with the huge cut to provider payments for Medicare. Households above the median will certainly be hurt but most of their pain will be from the results of the economy tanking once all that money is removed from the economy. Those below the median will be hurting as soon as their tax bill rises.

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