Sneak attack on National Debt

[kallend 2,174]

www.cincypost.com/2004/06/25/edita062504.html

Our $8 trillion headache

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That the national debt limit needs to be raised because we are borrowing so much money is no great secret, but Republicans in Congress want to raise that limit with as little public notice as possible.
That would rule out a freestanding vote because that would highlight the record deficits the Republicans have run up over the last three years.

The Democrats, retroactive converts to the cause of balanced budgets, would point out that, after taking office with the publicly held share of the national debt declining thanks to four years of surpluses, the Bush administration has had to twice ask that the borrowing cap be lifted, for a total of $1.4 trillion.

Now it needs a third of about $690 billion -- and soon. That would take the gross national debt to more than $8 trillion, an impressive number.

The leadership had hoped to slip the increase through as part of a congressional budget resolution, but for the second year in a row, House and Senate Republicans might not be able to agree on a budget.

So House Republican leaders hatched a plan to attach the debt limit to a huge, $417 billion defense spending bill that was certain to pass. It worked; on Tuesday the defense spending bill passed, 403 to 17 -- although the vote to attach the debt limit provision was approved only 220-196.

The plan fell apart in the Senate, however, when angry Democrats threatened to block action on any defense spending legislation that included the debt ceiling provisions.

Rather than risk that happening, Republican leaders promised that the debt ceiling language would not be part of the final legislation. With that, the defense bill moved toward likely passage in the Senate today.

The White House, for its part, is anxious to get this issue settled and out of the way lest some Ross Perot type make it a political issue as happened to the first President Bush in 1992.

The Treasury will bump up against the $7.3 trillion debt limit later this summer. The White House has told congressional Republicans that Bush's Treasury secretary, John Snow, could stall for time, and maybe even get past the November election without lifting the cap, by juggling some government accounts and borrowing from others.

But there's a problem: When President Clinton's Treasury secretary Robert Rubin did that, these same congressional Republicans threatened to impeach him.

It's so true in Washington: What goes around, comes around.

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The only sure way to survive a canopy collision is not to have one.

[storm1977 0]

And the democrats want to Reinstate the DEATH TAX. It is currently on the floor of the house now.

Why, because when I die the moronic Democrats think they are entitled to my money that I worked my entire life for.
Nope sorry... My money and my estate belongs to who I will it to.

Democrats = TAXES

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Sometimes it is more important to protect LIFE than Liberty

[PhillyKev 0]

You must be loaded...

98 percent of descendants avoid taxes altogether because the first $675,000 of an estate is exempt from taxation, an exemption that is due to rise to $1 million by 2006 under current law. Only 47,500 estates paid any estate tax in 1998, the most recent year for which figures are available, and about half the money raised by the estate tax was paid by fewer than 3,000 estates worth more than $5 million each, according to the Internal Revenue Service.

[storm1977 0]

It is to early to be loaded.... just a couple drinks so far. Maybe buzzed.

Seriously though: Yes what you say is true, but there is legislation on the floor to change that. This would directly affect small business owners whose net worth exceeded 500K. That is not exactly what I would call weathly if I were a small business owner.

Chris

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Sometimes it is more important to protect LIFE than Liberty

[PhillyKev 0]

I'm not sure what you're talking about. First of all the estate tax never went away, so I'm not sure how it would be reinstated. And actually, the exemption was raised from 1 million to 1.5 million in January of this year.

Oh yeah, and apparently Republicans = Taxes

Susan Collins and Olympia Snowe of Maine, John Chafee of Rhode Island, and John McCain of Arizona oppose the new tax-cut proposal

[rehmwa 2]

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You must be loaded...

98 percent of descendants avoid taxes altogether because the first $675,000 of an estate is exempt from taxation, an exemption that is due to rise to $1 million by 2006 under current law. .

$1 million dollars -
a simple person can accumulate that over his life through the magic of investing and compound interest
a poor farmer with a couple sections of land and lots of farm equipment
a small business owner in a good part of a metropolitan area - not doing too well but the property is worth a bunch
You think some Dropzone owners have that much in cash and property? Would it have been fair for Rook and Missy not to be able to carry on the family business just because the government took away most all of Roger's business after his accident?

It's not that much $$$ anymore.

However, apparently you think it is ok for that "98%" to gang up and shit on that other 2% based on something as trivial as accumulated wealth. Read "the millionaire next door" these could be your friends and neighbors and just regular decent folk that are being targetted. They aren't all mansion tycoons with shady deals and bad morals.

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[PhillyKev 0]

You apparently stopped reading after the part you quoted.

When the limit was 1Million only 47,500 were hit with the tax. And half of those inherited over 5million.

You apparently think it's ok to shit on the rest of society so that 25,000 multimillionaires, who have accumulated wealth, most likely in tax shelters don't have to pay taxes.

And it's not 1 million anymore. It's now 1.5million and going up to 3.5 million by 2009.

[PhillyKev 0]

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However, apparently you think it is ok for that "98%" to gang up and shit on that other 2% based on something as trivial as accumulated wealth.

And by the way, I paid over $5,000 in taxes just today. So don't try and claim I'm ganging up on someone else.

[rehmwa 2]

I like the bear.

Still, different rules for different people don't work for me. Taxes are for income. That money is inheritance, so it likely was already taxed. It's a moot point to me whether someone is worth $20 or $20 million.

And as long as the tax shelters are legal, then change the system, don't resent the people. It's complicated because congressment are always fighting to establish special rules for special groups.

Is your position then to tax wealth (everyone's savings and investment accounts) in addition to income? Then that's a change also. I don't think it's a good idea to go there.

Shitting on people is smelly. But it's good for a few bucks.

The dollar amount of the exemption is not the point either. It's an arbitrary boundary so it can never be fair. Treat everyone the same is the only fair thing.

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[Jib 0]

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You apparently think it's ok to shit on the rest of society so that 25,000 multimillionaires, who have accumulated wealth, most likely in tax shelters don't have to pay taxes.

No, I shit on the idea that the government should get more than half of what someone worked their life for and have already had 50% more than that taxed when they earned it.

$100 x 33% income tax
$67 x 50% estate tax

Govt: 66.5%
Family: 33.5%

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the depth of his depravity sickens me.
-- Jerry Falwell, People v. Larry Flynt

[rehmwa 2]

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However, apparently you think it is ok for that "98%" to gang up and shit on that other 2% based on something as trivial as accumulated wealth.

And by the way, I paid over $5,000 in taxes just today. So don't try and claim I'm ganging up on someone else.

I'd like to claim that you are ganging up on someone else at this point.

And 5G in taxes is getting off pretty easy if it's your total Federal tax for last year. Unless you mean you underpaid by $5K and this is the final settlement, then that's rough. If it's something else, then don't explain it to me, I'm just a farm boy from Iowa.

If it's the first, then everyone should have to pay their taxes directly out of their pockets instead of withholding then we can all feel what's really being done to us. from behind....when were not looking.....after eating a giant meal.....with no lube.....

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Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[PhillyKev 0]

Funny, I don't remember them changing the rules and making inheritence count as income. Oh wait, they didn't.

From www.irs.gov

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Generally, property you receive as a gift, bequest, or inheritance is not included in your income.

And you also might want to take some math courses.

$100 - $1,500,000 exemption = ???

Ok, so let's use a real world example and use 3Million inheritance.

3,000,000 - 1,500,000 = 1,500,000

1,500,000 x 37% estate tax (I use 37% because it is a GRADUATED tax, not a flat tax and that's what it comes out to.)

Gov't $555,800
Family $2,444,200

[PhillyKev 0]

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And 5G in taxes is getting off pretty easy if it's your total Federal tax for last year. Unless you mean you underpaid by $5K and this is the final settlement, then that's rough.

That's what I pay a month.

[Jib 0]

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And you also might want to take some math courses.

The effective tax rate is 50% @ about $7M
Don't make assumptions!
On the other hand, I was working under the old 55% tax scheme.

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Ok, so let's use a real world example and use 3Million inheritance.

Why not $5M so the 55% really hurts

Okay: $7.5M x 33% = $2.5M over a lifetime
5,000,000 - 1,500,000 = 3,500,000

3,000,000 x 43% (blended) = 1,290,800
500,000 x 55% = $275,000
$1,565,800

Gov't $1,565,800 + $2.5M = $4,065,800 total taxes
Family $3,434,200

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Generally, property you receive as a gift, bequest, or inheritance is not included in your income.

Kev, try some more tax classes. While the recipient on a gift may not be taxed, when you give over $10k (might be higher now) per year to one individual the estate tax clock starts running. Also, there's a generation skipping tax to worry about too if your not giving it to your kids.

Okay, you're right the $5,000,000 was a gift; so, let's back up again: How much did the parents have before the IRS took it taxed it twice? Over $15M, right? IRS $11.6M Grandkids: $3.4M

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the depth of his depravity sickens me.
-- Jerry Falwell, People v. Larry Flynt

[PhillyKev 0]

bzzzzztttt...wrong again.

First of all, that 33% off the person's income should also come from a graduated scale, it's not 33% on every penny.

Secondly, the tax on the 3.5 million would work out to 42%. And I have no idea where your 55% figure comes from since the graduated table tops off at 48% for anything over 2 million.

And you're mixing gift tax and estate tax rules.

[Jib 0]

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First of all, that 33% off the person's income should also come from a graduated scale, it's not 33% on every penny.

Would you agree that you'd be in the top income bracket to save $5M? So, how much would it be if you managed to save/invest (taxed too) $10k per year for 50years? [No, I'm not assuming any stepped up bases upon death and think about what $10k was in the 1970's]

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Secondly, the tax on the 3.5 million would work out to 42%. And I have no idea where your 55% figure comes from since the graduated table tops off at 48% for anything over 2 million.

For 2004. This part of the thread started out as a reinstatement of the "Death Tax," which I assumed meant back to the old way.

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And you're mixing gift tax and estate tax rules.

The last time I checked you could give away the same amount of money as gifts during the course of your life as your exemption and not pay any gift tax; however, those gifts would be returned to your estate for purposes of calculating it. No? Otherwise, the nice person giving you $1M (and ignoring the exemption) would have to pay the IRS gift taxes on the spot.

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the depth of his depravity sickens me.
-- Jerry Falwell, People v. Larry Flynt

[PhillyKev 0]

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The last time I checked you could give away the same amount of money as gifts during the course of your life as your exemption and not pay any gift tax; however, those gifts would be returned to your estate for purposes of calculating it. No? Otherwise, the nice person giving you $1M (and ignoring the exemption) would have to pay the IRS gift taxes on the spot.

Sort of, the exemption is for gift and/or estate tax. If you use up the exemption on gifts then you can't use it on the estate. But you don't use that unified exemption for gifts until you exceed the yearly limit of $11,000.

So, you can give away $11,000 per year and there won't be any gift tax, and it won't effect your estate tax exemption. Anything over 11,000 in a year may be exempted, but then the estate examption would be reduced by that amount.

[PhillyKev 0]

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Would you agree that you'd be in the top income bracket to save $5M?

Yes, but you don't get taxed at that rate for the ENTIRE amount. Only on the amounts above the preceeding brackets.

[jumper03 0]

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And 5G in taxes is getting off pretty easy if it's your total Federal tax for last year. Unless you mean you underpaid by $5K and this is the final settlement, then that's rough.

That's what I pay a month.

So again off topic -
My god - how much are making a month to have to pay 5G in taxes???? I haven't even hit 1.6G for the entire year!!

No wonder you getting a Harley.

Jump

Scars remind us that the past is real

[PhillyKev 0]

I love my job.

[lawrocket 3]

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You apparently think it's ok to shit on the rest of society so that 25,000 multimillionaires, who have accumulated wealth, most likely in tax shelters don't have to pay taxes.

Nope. I don't think it's fair to shit on 25,000 or 50,000 or 100,000 kids, whose parents have accumulated wealth, so that another quarter of a million people can be on general relief.

How about this? Unfair to shit on those kids so Haliburton can get more money.

Or shit on those kids so the feds can provide matching funds to GWB's reelection campaign.

Or shit on the kids of farmers, who must sell the property to pay the taxes, whereon the buyers pave it and put up a parking lot.

Or (as is most often the case), shit on the employees of the family business, which must liquidate and close shop to pay the gubment the taxes on the family business. Or shit on the customers who were happy witht he business.

My wife is hotter than your wife.

[kallend 2,174]

And then there's the National Debt, at record levels and getting bigger at record rate.

...

The only sure way to survive a canopy collision is not to have one.

[PhillyKev 0]

If you have a business worth a couple million bucks, and you don't incorporate or form an llp and set it up so that the company is not a personal asset of yours and therefore not part of the estate, then you're an idiot. Or, you don't care.

[lawrocket 3]

Do you mean put all th eproperty in a trust?

My wife is hotter than your wife.

[PhillyKev 0]

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Do you mean put all th eproperty in a trust?

No, that would encounter the gift tax. Form a partnership or corporation and make them owners of the business.