47% Don't Pay Taxes

Off Topic Politics & World Issues
21

[quote]tedro wrote:
countingbeans wrote:
I’m curious how the people in the article are getting FICA back. I have filed countless returns with NOL’s and have never once seen FICA refunded.

I don’t think they are actually getting FICA taxes back. I think that they are just getting enough back in refundable tax credits to completely offset what they pay into FICA. I would guess this is mostly people with a few kids getting the extra deduction and the refundable child tax and earned income credits.[/quote]

Now that makes perfect sense.

I wasn’t thinking outside the box. Good work. Thanks

22

I would seriously NOT do anything without a Good accountant. Not some H&R block accountant but a good accountant. Worth their weight in Gold.

23

What a disaster.

24

Ok, is it that 47% are confirmed to having NOT paid tax, or that 47% have enough LOOPHOLES available to them that they COULD potentially avoid paying the full income tax for their tax bracket?

I am skeptical of statistics here.

25

[quote]PonceDeLeon wrote:
Ok, is it that 47% are confirmed to having NOT paid tax, or that 47% have enough LOOPHOLES available to them that they COULD potentially avoid paying the full income tax for their tax bracket?

I am skeptical of statistics here.[/quote]

You’re right. As an example, when you first form a new corporation you can take a tax break or exemption for the first 2 years as you’re trying to get off the ground. Right there you will be paying no new taxes and can fall into that statistic. Nevermind that during that time you’re pumping money and investments into the economy and most importantly employing people and paying their FICA, Social security, unemployment insn etc etc… In the end you pay the taxes just on the back end.

Statistics can be spun so easily to make any point anyone wishes.

ALSO OF NOTE, the tax system is setup for Entrepreneurship. There is nothing wrong with the tax code. It’s a good code, but you have to use it wisely. This becomes more and more apparent when you open your own business. After all America is founded on Entrepreneurship, not 9 to 5 workers, No offense intended.

26

[quote]Gregus wrote:
PonceDeLeon wrote:
Ok, is it that 47% are confirmed to having NOT paid tax, or that 47% have enough LOOPHOLES available to them that they COULD potentially avoid paying the full income tax for their tax bracket?

I am skeptical of statistics here.

You’re right. As an example, when you first form a new corporation you can take a tax break or exemption for the first 2 years as you’re trying to get off the ground. Right there you will be paying no new taxes and can fall into that statistic. Nevermind that during that time you’re pumping money and investments into the economy and most importantly employing people and paying their FICA, Social security, unemployment insn etc etc… In the end you pay the taxes just on the back end.

Statistics can be spun so easily to make any point anyone wishes.

ALSO OF NOTE, the tax system is setup for Entrepreneurship. There is nothing wrong with the tax code. It’s a good code, but you have to use it wisely. This becomes more and more apparent when you open your own business. After all America is founded on Entrepreneurship, not 9 to 5 workers, No offense intended.
[/quote]

Of course this is widening. The income gap is growing, duh. This statistic is an effect of this. Shrink the income gap either by bringing down the top or raising the bottom and this 47% will go down.

27

[quote]countingbeans wrote:
Gregus wrote:

If you do this, and it is not a bad idea, you will HAVE to make quarterly payments or you will end up paying penalties.[/quote]

You would use a form 1099 for this, or am I mistaken?

28

[quote]Gregus wrote:
ALSO OF NOTE, the tax system is setup for Entrepreneurship. There is nothing wrong with the tax code. It’s a good code, but you have to use it wisely. This becomes more and more apparent when you open your own business. After all America is founded on Entrepreneurship, not 9 to 5 workers, No offense intended. [/quote]

Can you elaborate on how the tax system benefits business owners, if I read you correctly?

29

[quote]Nominal Prospect wrote:
countingbeans wrote:
Gregus wrote:

If you do this, and it is not a bad idea, you will HAVE to make quarterly payments or you will end up paying penalties.

You would use a form 1099 for this, or am I mistaken?[/quote]

No. A 1099 is what a company gives you at the end of the year if you are an independent contractor. It is an informational form filed with the IRS that allows them to track the income you’ve made throughout the year.

You make the payments with the 1040-es and similar type forms for state taxes.

(There are exceptions that a taxpayer can meet in order to avoid having to pay penalties if you do not make estimated payments. But it involves giving your money to the Government one way or another.)

30

libertarian party 2012

31

[quote]Nominal Prospect wrote:
Gregus wrote:
ALSO OF NOTE, the tax system is setup for Entrepreneurship. There is nothing wrong with the tax code. It’s a good code, but you have to use it wisely. This becomes more and more apparent when you open your own business. After all America is founded on Entrepreneurship, not 9 to 5 workers, No offense intended.

Can you elaborate on how the tax system benefits business owners, if I read you correctly?[/quote]

Just in the way the code is written. It’s all about entrepreneurship. I don’t know if you’re a business owner or not. If you are then you already know, or have a bad accountant. If you don’t know, then open a business and find out :slight_smile: It’s a different world from the standard way auto deduction is done on paychecks.

32

This is the end of America and freedom.

33

[quote]Gregus wrote:
Nominal Prospect wrote:
Gregus wrote:
ALSO OF NOTE, the tax system is setup for Entrepreneurship. There is nothing wrong with the tax code. It’s a good code, but you have to use it wisely. This becomes more and more apparent when you open your own business. After all America is founded on Entrepreneurship, not 9 to 5 workers, No offense intended.

Can you elaborate on how the tax system benefits business owners, if I read you correctly?

Just in the way the code is written. It’s all about entrepreneurship. I don’t know if you’re a business owner or not. If you are then you already know, or have a bad accountant. If you don’t know, then open a business and find out :slight_smile: It’s a different world from the standard way auto deduction is done on paychecks.
[/quote]

You brought up this auto-deduction thing earlier in the thread an I ignored it. While I don’t disagree that it’s a good idea to make sure you are withholding the correct amount, to go so far as suggesting the tax-code is set up for entrepreneurs is just plain ignorant.

I’m willing to be the majority of the regulars in this forum have their withholdings pretty well dialed in. While I doubt many pay their taxes on a quarterly basis, this is small apples compared to the disincentive to work and start businesses in this country. Withholding the correct amount or only paying as often as legally required does nothing to lower your tax bill, it simply puts the money in your pocket sooner. With today’s interest rates the present value of this money is insignificantly more than the value would be when you get your refund.

Let’s start with my favorite taxes, social security and medicare. Just for showing up I get 7.65% of my salary chopped off and stand a good chance of never seeing that money again, or at least substantially less when factoring in inflation and opportunity costs. Lucky for me though, if I become an entreprenuer and start my own business, I get to double this number to 15.3% of every dollar I make (yes I know, only 3.3 after ~110K).

Need to set up a C corporation for your newly founded business? Hooray for double taxation! Every dollar of profit for the company gets taxed at corporate rates (second only to Japan for the highest amongst developed companies) and then you get to pay 15% tax on every dollar of profit you pay to yourself as a dividend.

34

fact time.

the us constitution authorizes two types of taxes, direct and indirect. the 16th amendment(properly ratified or not) did NOT authorize a new form of tax.

“We are of opinion, however, that the confusion is not inherent, but rather arises from the conclusion that the 16th Amendment provides for a hitherto unknown power of taxation; (That of being able to tax people outside direct and indirect, as they are being taxed today - JTM) that is, a power to levy an income tax which, although direct, should not be subject to the regulations of apportionment applicable to all other direct taxes. And the far-reaching effect of this erroneous assumption will be made clear by generalizing the many contentions advanced in argument to support it…”

“But it clearly results that the proposition and the contentions under it -(the 16th Amendment), if acceded to, would cause one provision of the Constitution to destroy another; that is, they would result in bringing the provisions of the (16th) Amendment exempting a direct tax from apportionment into irreconcilable conflict with the general requirement that all direct taxes be apportioned.” Brushaber v. Union Pacific R. Co., 240 U.S. 1 (1916)

“The provisions of the Sixteenth Amendment conferred no new power of taxation but simply prohibited the complete and plenary power of income taxation possessed by congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged…” S. Pacific v. Lowe, 238 F. 847 (US Dist. Ct. S.D., N.Y., 1917); U.S. 330 (1918)

“The legislative history merely shows that the words ‘from whatever source derived’ of the Sixteenth Amendment were not affirmatively intended to authorize Congress to tax state bond interest or to have any other effect on which incomes were subject to the federal taxation, and that the sole purpose of the Sixteenth Amendment was to remove the apportionment requirement for whichever incomes were otherwise taxable.” [South Carolina v. Baker, 485 U.S. 505 (1988) (footnote 13)]

“The Sixteenth Amendment, although referred to in argument, has no real bearing and may be put out of view. As pointed out in recent decisions, (Brushaber), it does not extend the taxing power to new or excepted subjects, but merely removes all occasion, which otherwise might exist, for an apportionment among the states of taxes laid on income, whether it be derived from one source or another.” Peck v. Lowe, 247 U.S. 165 (1918.

35

If people think this is high now wait 2 more years.