Tax Bill

[HOF44]

2 hours ago, Skinsfan1311 said:

Alcohol, or Income? 😉

Sshhhhhhhhhh we don’t talk about that!!!!

[tshile]

5 hours ago, Elessar78 said:

On the other, it's also a very regressive tax

I don’t follow?

anyone can claim it but only up to 10k. It hurts people with more expensive houses and generally more money as they used to be able to deduct a lot more

[HOF44]

6 hours ago, Elessar78 said:

On one hand, SALT is a big money thing for those of you that live in high COLA/Blue areas. On the other, it's also a very regressive tax.

It really was targeted for those areas.  

[techboy]

3 hours ago, tshile said:

I don’t follow?

anyone can claim it but only up to 10k. It hurts people with more expensive houses and generally more money as they used to be able to deduct a lot more

 

He's saying that things like the mortgage deduction are regressive, because they disproportionately benefit the upper middle class and the wealthy. Poor people aren't able to deduct enough to make use of itemization. Here's one piece pre-Trump changes making that argument. https://www.brookings.edu/blog/up-front/2017/11/06/its-time-to-gut-the-mortgage-interest-deduction/

 

The SALT and mortgage deduction cap is progressive in that sense, and I suspect even the people upset about it here wouldn't have minded as much if that was done as part of a larger tax overhaul that made the tax code fairer in general.

 

The fact that it was done to help pay for a very regressive overall change in the tax code, with the added "bonus" that it tended to hit the blue states and Democrat leaning "college educated, well off but not Koch brothers rich" demographic the hardest, is I suspect what is causing the grief.

 

I agree with @Skinsfan1311, though. Given what @PleaseBlitzand @HOF44spend on liquor, whatever they're paying in taxes, it's not enough. 😳

[tshile]

8 hours ago, techboy said:

He's saying that things like the mortgage deduction are regressive, because they disproportionately benefit the upper middle class and the wealthy. 

right. I get that. But the government is always going to incentivize home ownership and the easiest way for them to incentivize things is cia tax credits/deductions. 
 

so I get that it leaves out people without mortgages. But they’re always going to do something, and as you said within the context of people it applies to it’s not regressive at all. 
 

I feel like calling somethings regressive tax implies it’s a bad tax that needs to be changed because it disproportionately taxes people with less money. I don’t think home ownership applies. It falls in the same category as child credits/deductions. Another one that will never truly go away. Just because you don’t have a child doesn’t mean the tax is regressive. for all with a child/house, it’s progressive. 
 

[tshile]

11 hours ago, HOF44 said:

It really was targeted for those areas.  

Well and it is part of a philosophical debate. One we don’t get to much because political discussions are so heated and everyone lives in their trenches these days. 
 

the idea that you should receive a tax deduction at the federal level because you paid state taxes for services is interesting.  You’re theoretically receiving a benefit for what you paid even if indirectly (via higher standards of living/more things to do/etc), why should you also receive a discount on your federal taxes? Especially when others aren’t getting the discount nor the services?

 

and conversely, to those in low tax areas, you could argue if they want they can demand their state provide more services and tax more so their money is going to state and local items as opposed to federal items. 
 

not ignoring the targeting and honestly the way the GOP behaves these days it’s way more likely they’re targeting than trying to kick off a serious philosophical national debate on how tax money would flow. But, I do think there’s an interesting debate to be had here and so long as both sides are honest and consistent I don’t really see a “wrong” side here. 

[HOF44]

My biggest issue with the Salt limitation is not the tax but the fact that all it funded was large cuts for businesses and the wealthiest.  If that had been part of providing a Basic Income or Universal Healthcare I would have been fine with it. 

[The Evil Genius]

 

48 minutes ago, HOF44 said:

My biggest issue with the Salt limitation is not the tax but the fact that all it funded was large cuts for businesses and the wealthiest.  If that had been part of providing a Basic Income or Universal Healthcare I would have been fine with it. 

 

I'd also guess that those blue progressive coastal states whose citizens were hurt by the 10k SALT limit were already some of the biggest donor states. Now more so because they are paying even more than their "fair share. 

[techboy]

1 hour ago, HOF44 said:

My biggest issue with the Salt limitation is not the tax but the fact that all it funded was large cuts for businesses and the wealthiest.  If that had been part of providing a Basic Income or Universal Healthcare I would have been fine with it. 

 

Yeah, that's what I noted, and in the broader context, what would normally be progressive just allowed something even more regressive.

 

1 hour ago, tshile said:

right. I get that. But the government is always going to incentivize home ownership and the easiest way for them to incentivize things is cia tax credits/deductions. 
 

 

 

 

Leaving aside the question as to whether the government should/will attempt to incentivize home ownership, the mortgage deduction absolutely IS regressive, because of how the standard deduction works. You don't get a benefit from that deduction AT ALL until you're over the standard deduction, which even before the latest tax code changes means that even middle class people only get a minor benefit unless they used advanced strategies like lumping tax payments for two years into one and taking the standard deduction in the other year. I, for example, used to itemize, but it was only worth it because my wife and I ALSO donated to charity, something poorer people couldn't do.

 

And, the reality is that in any case, all of these tax breaks absolutely are regressive, because if the tax burden is reduced on home owners and people that pay a lot of property taxes, that is reduced income to the government that will be have to be made up either in reduced Federal services, higher taxes on others, or more debt that eventually leads to one of the first two.

 

I've never been comfortable with the idea that a single mother in Alabama working two jobs to make ends meet ends up subsidizing an attorney in San Francisco because he has high SALT.

 

When Biden and the Democrats look at reforming the tax code, I'd like to see them keep the cap (at least), and incorporate that into a larger attempt to make the tax code more fair/progressive as a whole.  

[Skinsfan1311]

10 hours ago, techboy said:

 

He's saying that things like the mortgage deduction are regressive, because they disproportionately benefit the upper middle class and the wealthy. Poor people aren't able to deduct enough to make use of itemization. Here's one piece pre-Trump changes making that argument. https://www.brookings.edu/blog/up-front/2017/11/06/its-time-to-gut-the-mortgage-interest-deduction/

 

The SALT and mortgage deduction cap is progressive in that sense, and I suspect even the people upset about it here wouldn't have minded as much if that was done as part of a larger tax overhaul that made the tax code fairer in general.

 

The fact that it was done to help pay for a very regressive overall change in the tax code, with the added "bonus" that it tended to hit the blue states and Democrat leaning "college educated, well off but not Koch brothers rich" demographic the hardest, is I suspect what is causing the grief.

 

I agree with @Skinsfan1311, though. Given what @PleaseBlitzand @HOF44spend on liquor, whatever they're paying in taxes, it's not enough. 😳

I'm trying! 

Mrs. Skinsfan did her part,(we do file jointly, after all, and came home with these...

[tshile]

12 minutes ago, techboy said:

You don't get a benefit from that deduction AT ALL until you're over the standard deduction

Right, because the standard deduction covers you and gives you more... people who itemize don’t get the standard deduction on top of their itemized deductions. 
 

assuming they did their taxes properly, they absolutely could itemize, but would get less money. So they take the standard deduction. 

Edited February 22, 2021 by tshile

[The Evil Genius]

8 minutes ago, techboy said:

 

I've never been comfortable with the idea that a single mother in Alabama working two jobs to make ends meet ends up subsidizing an attorney in San Francisco because he has high SALT.

 

I get that.  But up until 2020, that attorney in SF was part of the group of ststes subsidizing the 2 job single Mom in Alabama and other places because California was a donor state (and Bama was Bama). Right now California is about as neutral as you can get on the donor state scsle but other states like Connecticut only receive 74 cents back on every dollar in Federal tax they pay. 

 

 

[techboy]

1 minute ago, The Evil Genius said:

 

I get that.  But up until 2020, that attorney in SF was part of the group of ststes subsidizing the 2 job single Mom in Alabama and other places because California was a donor state (and Bama was Bama). Right now California is about as neutral as you can get on the donor state scsle but other states like Connecticut only receive 74 cents back on every dollar in Federal tax they pay. 

 

Apart from vagaries of where federal buildings/bases/etc. are located, the concept of "donor state" is just another way of saying there are wealthier people in that state, so they pay more taxes. This does not bother me.

[The Evil Genius]

Can't speak oe others but last filing year we lost $9,380 in SALT deductions. Our property tax alone in 2019 almost met the 10k limit. 

[techboy]

13 minutes ago, The Evil Genius said:

Can't speak oe others but last filing year we lost $9,380 in SALT deductions. Our property tax alone in 2019 almost met the 10k limit. 

 

That sucks when you know that it went to fund a tax "reform" that made the tax code even more regressive, "coincidentally" hitting blue states the hardest.

 

I'd hope you'd have less of a problem if it was part of an overall reform that made the tax code more progressive/fair, and/or added something like UBI or universal health care, because the reality is if you're paying that much in property tax, you ain't poor, and as much as it's appealing to "tax the rich", the tax base is such that this kind of tax reform is necessarily going to lead to middle class and upper middle class people like you and me paying more, because we make all the money. There are a lot more of us than there are truly wealthy people (who should also pay more, of course).

[The Evil Genius]

Yes, not poor and not complaining as I see most taxes as beneficial to the common good. The caveat is that our joint income, while considered upper middle class in most the of the US, is solid middle class here in the East Bay area of the SF region. 

 

Median home prices in our area is currently at 700k and goes up another 50-100k every city closer to SF. We luckily bought under that current median in 2016.

 

I suspect that most homeowners around her who bought at our time period are facing the same dilemma in the 10k SALT cap. Not sure if anyone in Bidens ear is talking about it being phased out though...

Edited February 22, 2021 by The Evil Genius

[tshile]

1 hour ago, The Evil Genius said:

Can't speak oe others but last filing year we lost $9,380 in SALT deductions. Our property tax alone in 2019 almost met the 10k limit. 

Our property taxes are just below the limit. So. Yes. In the same boat as you. 
 

now we saw lower rates in the the higher income brackets, increased standard deductions, and we qualify for a few things we didn’t because income caps raised. 
 

so yeah we lost a lot of deductions. Our effective tax rate fell. I think we used to be around 18% and it’s was at like 15% last year. Or something similar to that difference. 
 

we made 40k more in income and net paid 10k less in taxes. Net swing of 50k. Huge benefit for us. And a stupid one we didn’t need. I’d rather not receive emails about donation groups to teachers to buy in-class school supplies...

[The Evil Genius]

Good news for anybody who owes.

 

 

[China]

Texans May Have to Pay $200–$400 Fee for Driving an Electric Vehicle

 

America's current system where roads and other vehicle infrastructure projects are paid for, in part, from gas taxes obviously can't survive in a world where everyone drives an electric vehicle. There is no single, obviously best solution to modernize the situation, but in Texas the issue has resulted in some Republicans coming out in favor of tax hikes.

 

The bill being discussed in the Texas state senate—Senate Bill 1728—would raise fees on electric vehicle (EV) owners as a way to make up for the gas tax they're not paying. The legislation would require an annual EV fee of between $190 and $240, an additional fee of over $150 for anyone who drives their EV more than 9000 miles a year, and an annual surcharge of $10 to fund a charging infrastructure advisory council.

 

Click on the link for the full article

[The Evil Genius]

 

[Ball Security]

8 hours ago, The Evil Genius said:

 

I read this over the weekend.  I looked up how much I pay in property taxes on my house and compared it to a similar house in Texas.  I found one that is about 2/3 the square footage of mine and is listed for about 100k less than what I could likely get.  That property’s taxes was about 4.5 grand more than what I pay.  But, yeah, no state income taxes.

[LadySkinsFan]

I didn't get the $600 stimulus payment in December so I claimed it on my tax return on the line provided. I'll let you all know if I receive it. I did receive the one in May 2020 USPS check and the one this year direct deposit.

Edited May 24, 2021 by LadySkinsFan

[BatteredFanSyndrome]

I didn't get the $600 payment either, but filed it on my taxes and it was built in as a rebate, that took us from owing to getting a little bit of a return back.

[The Evil Genius]

I filed online on Friday the 14th. Feds took our money on the 17th and the State refunded our amount on the 20th.

 

Probably the fastest refund ever. 

 

 

[TradeTheBeal!]