What we can expect after Jan 1, 2011 ?

[Sstashmoo]

This has been floating around the last few days, I have not validated any of it. What say you?

""In just six months, the largest tax hikes in the history of America will take effect. They will hit families and small businesses in three great waves on January 1, 2011:

First Wave: Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families. These will all expire on January 1, 2011:

Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent [[this is also the rate at which two-thirds of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below:

- The 10% bracket rises to an expanded 15%
- The 25% bracket rises to 28%
- The 28% bracket rises to 31%
- The 33% bracket rises to 36%
- The 35% bracket rises to 39.6%

Higher taxes on marriage and family. The “marriage penalty” [[narrower tax brackets for married couples) will return from the first dollar of income. The child tax credit will be cut in half from $1000 to $500 per child. The standard deduction will no longer be doubled for married couples relative to the single level. The dependent care and adoption tax credits will be cut.

The return of the Death Tax. This year, there is no death tax. For those dying on or after January 1 2011, there is a 55 percent top death tax rate on estates over $1 million. A person leaving behind two homes and a retirement account could easily pass along a death tax bill to their loved ones.

Higher tax rates on savers and investors. The capital gains tax will rise from 15 percent this year to 20 percent in 2011. The dividends tax will rise from 15 percent this year to 39.6 percent in 2011. These rates will rise another 3.8 percent in 2013.

Second Wave: Obamacare

There are over twenty new or higher taxes in Obamacare. Several will first go into effect on January 1, 2011. They include:

The “Medicine Cabinet Tax” Thanks to Obamacare, Americans will no longer be able to use health savings account [[HSA), flexible spending account [[FSA), or health reimbursement [[HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines [[except insulin).

The “Special Needs Kids Tax” This provision of Obamacare imposes a cap on flexible spending accounts [[FSAs) of $2500 [[Currently, there is no federal government limit). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. [[National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education.

The HSA Withdrawal Tax Hike. This provision of Obamacare increases the additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Third Wave: The Alternative Minimum Tax and Employer Tax Hikes

When Americans prepare to file their tax returns in January of 2011, they’ll be in for a nasty surprise—the AMT won’t be held harmless, and many tax relief provisions will have expired. The major items include:

The AMT will ensnare over 28 million families, up from 4 million last year. According to the left-leaning Tax Policy Center, Congress’ failure to index the AMT will lead to an explosion of AMT taxpaying families—rising from 4 million last year to 28.5 million. These families will have to calculate their tax burdens twice, and pay taxes at the higher level. The AMT was created in 1969 to ensnare a handful of taxpayers.

Small business expensing will be slashed and 50% expensing will disappear. Small businesses can normally expense [[rather than slowly-deduct, or “depreciate”) equipment purchases up to $250,000. This will be cut all the way down to $25,000. Larger businesses can expense half of their purchases of equipment. In January of 2011, all of it will have to be “depreciated.”

Taxes will be raised on all types of businesses. There are literally scores of tax hikes on business that will take place. The biggest is the loss of the “research and experimentation tax credit,” but there are many, many others. Combining high marginal tax rates with the loss of this tax relief will cost jobs.

Tax Benefits for Education and Teaching Reduced. The deduction for tuition and fees will not be available. Tax credits for education will be limited. Teachers will no longer be able to deduct classroom expenses. Coverdell Education Savings Accounts will be cut. Employer-provided educational assistance is curtailed. The student loan interest deduction will be disallowed for hundreds of thousands of families.

Charitable Contributions from IRAs no longer allowed. Under current law, a retired person with an IRA can contribute up to $100,000 per year directly to a charity from their IRA. This contribution also counts toward an annual “required minimum distribution.” This ability will no longer be there.

http://www.atr.org/six-months-untilb...x-hikes-a5171#

[jcole]

Why don't you try verifying it before you post it?

[Sstashmoo]

Yeah, I'm going to spend the rest of the day researching that. I did check Snopes and nothing turned up. I do know the Bush tax cuts are expiring, that part of it is true.

[jcole]

Then why post it?

[Pam]

Then why post it?

So someone else will do the work for him. Tip- if it came in an email forward, it is probably bullshit.

[Sstashmoo]

Quote: "Then why post it?"

This is a discussion board, it was presented for discussion.

You're cute, in a little woman sort of way..

[ghettopalmetto]

""In just six months, the largest tax hikes in the history of America will take effect. They will hit families and small businesses in three great waves on January 1, 2011:

First Wave: Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families. These will all expire on January 1, 2011.

No shit. It was the most expensive, egregious tax cut in history, so it only reasons that expiration of this cut would constitute the largest tax "hike" in history.

These assholes would have you believe it will be the End of Days, when in reality, the tax rates will be far lower than they were under St. Ronald of Reagan.

The return of the Death Tax. This year, there is no death tax. For those dying on or after January 1 2011, there is a 55 percent top death tax rate on estates over $1 million. A person leaving behind two homes and a retirement account could easily pass along a death tax bill to their loved ones.

The ESTATE Tax applies to less than 1% of all estates. This is fearmongering at its finest. We should be so lucky to be able to even own two homes and a retirement account, let alone pass them along to our descendants.

But yeah, let's get rid of the estate tax so that no descendants of Richard Cheney will ever have to get a real job like us poor working slobs.


My heart goes out to all the hard-and-non-working millionaires in this country. It takes humongous balls to whine about your expiring tax cuts when many millions of people in this country are struggling to even find a job right now. Get over yourselves.

[Sstashmoo]

jcole, see?

[jcole]

So someone else will do the work for him. Tip- if it came in an email forward, it is probably bullshit.

My thought exactly, Pam. He's too lazy to do the work himself and needs someone else to make up his mind for him.

[jcole]

Quote: "Then why post it?"

This is a discussion board, it was presented for discussion.

You're cute, in a little woman sort of way..

And I'm sure you're cute in a 'little' way too.

[Sstashmoo]

Oh boy, here we go...

[Johnlodge]

I'm not sure something using the term "Obamacare" is interested in being an unbiased presentation of facts.

You're cute, in a little woman sort of way..

I have a reply for this, but I'm not ready to get banned.

[jiminnm]

Why don't you try verifying it before you post it?

If you had any knowledge of our tax laws, you'd know that this is is all true.

[jcole]

If you had any knowledge of our tax laws, you'd know that this is is all true.

He stated that he didn't bother to verify it; I was not questioning tax laws, just his reason for posting rumor.

[Detroitej72]

You can tell the author is a biased, right wing radical who favors entitlement tax cuts for those making over $250,000/yr.

That's my thoughts.

[jiminnm]

No shit. It was the most expensive, egregious tax cut in history, so it only reasons that expiration of this cut would constitute the largest tax "hike" in history.

These assholes would have you believe it will be the End of Days, when in reality, the tax rates will be far lower than they were under St. Ronald of Reagan.

Actually, these are the tax rates enacted under Reagan.

First. .$50,000 -- 15 %
$50,000-$75,000 -- 25
$75,000-$100,000 -- 34
$100,000-$335,000 -- 39

Over $335,000 -- 34


Yes, I can hardly wait until the rich in the lowest tax bracket have their taxes increase by 50%.

The ESTATE Tax applies to less than 1% of all estates. This is fearmongering at its finest. We should be so lucky to be able to even own two homes and a retirement account, let alone pass them along to our descendants.

But yeah, let's get rid of the estate tax so that no descendants of Richard Cheney will ever have to get a real job like us poor working slobs.

My heart goes out to all the hard-and-non-working millionaires in this country. It takes humongous balls to whine about your expiring tax cuts when many millions of people in this country are struggling to even find a job right now. Get over yourselves.

Why should the government receive anything because someone dies?

[jiminnm]

He stated that he didn't bother to verify it; I was not questioning tax laws, just his reason for posting rumor.

If this is true, how is it rumor?

[ghettopalmetto]

Actually, these are the tax rates enacted under Reagan.

First. .$50,000 -- 15 %
$50,000-$75,000 -- 25
$75,000-$100,000 -- 34
$100,000-$335,000 -- 39

Over $335,000 -- 34

Please cite source for data.

Yes, I can hardly wait until the rich in the lowest tax bracket have their taxes increase by 50%.

As my math teachers used to say, show your work.

Why should the government receive anything because someone dies?

Why should someone be discouraged from working simply because they were born to wealthy parents? You do not believe that those wealthiest 1% of us, who have benefitted disproportionately from our stable government and capitalist economic system, should be expected to contribute to its continuance?

[jcole]

If this is true, how is it rumor?

There is no citation saying where it came from, who it came from or why.

[Detroitej72]

Why should someone be discouraged from working simply because they were born to wealthy parents? You do not believe that those wealthiest 1% of us, who have benefitted disproportionately from our stable government and capitalist economic system, should be expected to contribute to its continuance?

They are entitled to tax breaks because they worked hard to be born into affluent families. Just listen to uncle Rushie, he has repeated that mantra on several occasions.

[jiminnm]

Please cite source for data.


The IRS. Google is your friend.


As my math teachers used to say, show your work.


When the lowest rate increases from 10% to 15%, that's a 50% increase.


Why should someone be discouraged from working simply because they were born to wealthy parents? You do not believe that those wealthiest 1% of us, who have benefitted disproportionately from our stable government and capitalist economic system, should be expected to contribute to its continuance?

I don't think anyone should be discouraged from working, for any reason. But when governments use tax law to influence societal behavior, instead of what should be its sole purpose of fairly raising operatings funds for the government, you create exactly the type of societal dissention between those of differing income levels that we have today and impose a system that many view as unfair.

If you die with an estate valued at $1 million, your estate will pay nothing. If you die with an estate worth $2 million, the estate will pay tax of $550,000. If you die with an estate worth $6 million, the estate tax will be $2.75 million [[3 times the value and 5 times the tax). If you die with an estate valued at $20 million, the tax will be $10.725 million [[10 times the income and 19.5 times the tax).

And, before you accuse me of selfishness or some such nonsense, the estate tax is irrelevant to me personally. Whatever is left when I depart is bequeathed to charitable organizations and will not be taxable [[unless we lose that also).

[jiminnm]

There is no citation saying where it came from, who it came from or why.

There's a cite at the bottom of sstash's post. If you peruse any web site dealing with financial matters, you'll find similar discussions. Why? Because what is laid out is exactly what will happen if Congress doesn't act to change tax laws before the end of the year.

[jcole]

Look, he even admitted he didn't validate it, so he wants others to do the work he doesn't want to. If you want to do it for him go ahead. I'm out.

[oladub]

Try http://www.jct.gov/publications.html...rtdown&id=3646 if you don't like the messengers. This link was in the OP linked article. But why all the concern over the message? After all, we have the President's word,

"I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes." - Barack Obama

Plain and simple; no tax increases are in store for us under President Obama. No increases in any of our taxes. Haha.

[Sstashmoo]

Quote: "Look, he even admitted he didn't validate it, so he wants others to do the work he doesn't want to. If you want to do it for him go ahead. I'm out."

ughh, it's not easy being Sstashmoo..