I think it's a great idea that everyone have skin in the game. If government wants to spend more, *everyone* pays more. Changing the rules in the middle of the game always hurts people.
If those are tax-free munies, perhaps. Munies are extremely risky these days. Retirements are going to crash the entire sector.
How many retired people have children?
That corresponds with what I estimated for my situation. Lefties are grossly underestimating how much the tax cuts are going to help people. Starting in about two weeks. "It's the economy, stupid!"
No Munies, a couple can earn up to $77,200 in qualified dividends and capital gains and be in the 0% tax bracket .
Put $10,000 and $87,200 and 10% tax bracket into the calculator, you'll see $0 taxes due.
Not many, but I frequent several retire early blogs and forums and there are some, probably more than you think. Those that make a plan to live on 65% of their income can retire in their 40s. Takes 25 working years.
Assumptions:
You can earn 5% investment returns after inflation during your saving years You?ll live off of the ?4% safe withdrawal rate? after retirement, with some flexibility in your spending during recessions.
That's true, but many families can manage to earn $70,000, if they save 35% of that then earn 5% on their savings (which is normally a conservative number) they have proved they can live on $45,500. After 25 years their nestegg will be $1,128,000. 4% of that is $45,080, but it is better than that because they no longer need to pay SS, if they do it right there will no federal taxes either. The "4% rule" allows an inflation raise each year.
For many early retires if they get any SS it is gravy on top, some expect they will, others think not.
I guess I was thrown by your use of the term "wage earner". To me that means someone who is working. The "wage earner" category you are using includes people in retirement who have little or no income and of course, the poor and unemployed.
So where is the problem in this? I recall meeting a lady working in the local Sheetz. She said she had to work three part time jobs to pay her bills. Do you expect her to be paying income taxes? She is already paying FICA to cover her retirement fund. She is paying sales tax. She is paying all the many miscellaneous taxes in everything we do and pay for.
Actually, she is likely paying taxes now. A few months after I met her at the Sheetz I ran into her at a local coffee shop where she had a big smile. This was a much better job and being full time she made enough in one job to be able to live. But then the local hospital bought and tore down the shopping center where the coffee shop was. But some time later I saw the store open again on the other side of town, so I expect she is employed again. In the meantime, while unemployed do you feel she should have been paying taxes still?
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Rick C
Viewed the eclipse at Wintercrest Farms,
on the centerline of totality since 1998
Only one that should not be included in the tax base is the person that's unemployed and has zero income. However, I remember when the autoworkers were unemployed, they got 95% of their already high wage. I suspect they would be eligible to pay some Federal income Taxes.
3 twenty hour jobs at $10 an hr is $30k a year. So she's part of the 45% that doesn't pay taxes. She's working earning money, why should she be dropped from the list of American earners?
In the meantime, while unemployed do you feel she
Pay taxes on what, if unemployed she didn't have any income? Now your getting silly.
The point is we have lots of people and families earning money and 45% of those don't pay any taxes. That means that the other 55% pay the full brunt for 100% of the citizens. That's all. But many of those like to complain the rich don't pay their fair share. I almost got to zero tax last year, I could have been part of the 45%. Mikek
As I pointed out the 4% rule allows an inflation raise every year. However I agree and present an argument in the early retirement groups regularly that $700,000 is not enough and $1,000,000 is getting you close but at $40k you are living on 71% of the median US family income. Now it is true that many have their home paid for, and they are young, so if they have a couple of bad stock market years, they can go back to work for a time to correct that. Not so easy when your older. Just so you know, $45,000 with a 3% inflation raise is $81,275 in 20 years. So the income is not stagnant.
So Social Security should be taxed? Who was paying the auto workers? I've never seen unemployment pay more than a subsistence pay.
Your numbers are made up. What makes you think she was working 60 hours a week?
I agree with the government that if your pay is below some figure you shouldn't be paying income taxes and your tax should be progressive otherwise. All the other taxes you pay are enough.
I don't get why you think the government should be supported on the backs of the low wage earners. That's the point of a progressive income tax. At least this one tax is progressive not requiring those with the least to give to have to support the government the same way as those with so much. It's not like everyone receives equally. Those with the most money virtually own government. They are the ones funding the PACs that get politicians elected.
You are the one saying everyone should pay their way. Even zero wage earners pay taxes, just not income taxes.
Yes, that number has been around for a long time and it isn't just about "families earning money". It's about *ALL* the people who don't pay income tax while *STILL* paying many other taxes. In other words, that statistic doesn't say what you and Mitt Romney would like it to say. That's why he lost voters when he said it.
As if income tax were the *ONLY* tax paid by anyone. Bull!
I'm proud of you for paying your fair share, lol.
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Rick C
Viewed the eclipse at Wintercrest Farms,
on the centerline of totality since 1998
If you have other income, 85% of SS can and is taxed.
Who was paying the auto workers? State unemplyment and then the union kicked in the rest to bring them to 95%. It's bee 25 years since I lived in Michigan and the auto companies aren't doing as well and the unions don't have the strength they did, so I don't know the payments at this time.
So her part time jobs were less then 20 hours. OK.
Hmm, I had to go back and see what I wrote. I see this; "Only one that should not be included in the tax base is the person that's unemployed and has zero income." When I said included in the tax base, I meant the others should be counted as part of the 100% of American households. Of that group, 45% don't pay Federal income taxes.
Not sure I said that, I pointed out that about 1/2 the population pays no federal taxes.
We can argue if you want about SS, but My opinion is SS is a retirement, disability, income for your children if you die insurance policy. It is for your own good and it's good that people are forced into it, because most wouldn't do it for themselves. My wife and I would have been much better off if we had invested the money ourselves, But now at 62, I'm happy to have a known quantity, rather than a large sum at the vagaries of the stock market.
I used the rules as written. Written into the rules are the standard deduction, dependent deductions, SEP/IRAs deductions, HSA deductions, capital loss deductions, self employed health insurance deduction,
College tuition credits and 0% tax on Dividends and capital gains if you are in the 10% bracket. I used all those and a couple more.
I'm proud to keep my earnings invested where they will do best for my family. Mikek
So why did you bring them up? They received other wages and they paid tax. They clearly aren't in your 45%.
I don't know. But I'm not making up crap to post. I don't know why you are making up stuff.
You are using too many pronouns. I don't know who is in what group. I know the 45% figure uses the term "households", no mention of source or level of income. That means *all* households.
It's not half the population. It's around 45% of households.
More importantly, you fail to point out any relevance to this particular statistic.
Where did I say anything about SS??? You keep addressing your own narrative without trying to understand what I'm saying.
Yes, so why should anyone else do any differently?
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Rick C
Viewed the eclipse at Wintercrest Farms,
on the centerline of totality since 1998
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