OT - I don't _hate_ McMansions

Von Fugal von at fugal.net
Fri Jun 27 22:12:57 MDT 2008


<quote name="Levi Pearson" date="Fri, 27 Jun 2008 at 21:58 -0600">
> Von Fugal <von at fugal.net> writes:
> >>
> >> Are you sure you pay 40% of your income to taxes?
> >>
> >> I tracked all my taxes for a month (every piece of tax: sales tax,  
> >> property tax, gasoline tax, income tax, social security tax, phone bill  
> >> taxes, etc), and it wasn't that high.
> >
> > Interesting... I pulled that number out of the air (maybe I heard it
> > somewhere and my subconscious brought it up) but I look at a wikipedia
> > article:
> > http://en.wikipedia.org/wiki/Taxation_in_the_United_States
> > and hey look! 40%! wow I'm good! Then another figure: "government will
> > collect 30.8% of the nation's income for 2008." And that doesn't even
> > account for inflation, the hidden tax. What? You _really_ don't think
> > that government benefits from being first to use new money where
> > everyone else pays the price? Sure sounds like a tax to me.
> 
> Okay, so someone needs to read a little further in the Wikipedia
> article, or have some sort of clue from elsewhere about taxes.  You do
> pay your taxes, right?  Or are you still a poor student that doesn't
> make enough money to owe anything?

I'm a poor student that doesn't pay anything in taxes, actually, well,
except for the inflation tax, it still smarts even without the rest of
the taxes. I also know I will pay taxes when I'm done being a student.

> So, marginal tax rate is the rate for the tax bracket you're in.  But
> you don't actually *pay* that amount.  If you think about the little
> bit you read, that should be obvious.  I mean, take the following
> facts: The government will collect 30.8% of the nation's income for
> 2008.  Tax rates are progressive; the percentage is higher the more
> income you have.  And the average marginal rate is 40%.  Clearly the
> average person doesn't pay 40%, or the total collection from the
> nation's income would be way higher than 30.8%.

But the average IS 30.8%, with a much lower median thanks to the
progressive scale, but an average is an average, and on average
americans would have 40% more income to throw around. That is a lot even
if not for you personally. I promise the economy deeply feels the effect
of 30.8% taxation. All of us indirectly feel it, too. Lucky for the
government it is indirect (I think they planned it that way) because now
everyone just blames it all on greedy oil companies and greedy
developers. We wouldn't even be having this discussion about lame homes
if the economy was in decent shape.

> What happens is that you start with the 40% (or whatever your marginal
> rate happens to be) and apply deductions (there's a standard deduction
> if you haven't got enough to itemize), credits, etc. to determine what
> your *actual* rate is.  And for most people, I believe it will end up
> being far less than 30%, especially for low income people who may even
> get a small subsidy after the credits are accounted for.  I make a
> decent salary, and my final percentage was well under 30%.

I was just noting the amusement that 40% was in wikipedia and I pulled
40% out of the air. Amusement. The figures I'm referring to *are* way
different from what wikipedia is talking about. I'm referring to the
total effect of all taxes.

> You're funny, Von.  All this outrage, and you don't appear to have
> even ever worked through a tax form.  Please, join the real world,
> it's really not that bad of a place.

Yes, discredit me with attacks on my sanity. I have worked through many
tax forms. They are a horrendous waste of time for everybody involved.
Yet another drop in the net effect of US taxes. I stand by that forty
percent as a rough figure. After seeing that net tax collection is 30.8%
of net income, I still say I can't be far off, esp factoring in
inflation and other indirect tax effects.

Von Fugal
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