Thread: Us taxes out of control?

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 not 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.

PDF Version Read more: http://www.atr.org/six-months-untilbr-largest-tax-hikes-a5171#ixzz0sY8waPq1

Now your insurance is INCOME on your W2's......

One of the surprises we'll find come next year, is what follows - - a little "surprise" that 99% of us had no idea was included in the "new and improved" healthcare legislation . . . the dupes, er, dopes, who backed this administration will be astonished!

Starting in 2011, (next year folks), your W-2 tax form sent by your employer will be increased to show the value of whatever health insurance you are given by the company. It does not matter if that's a private concern or governmental body of some sort. If you're retired? So what; your gross will go up by the amount of insurance you get.

You will be required to pay taxes on a large sum of money that you have never seen. Take your tax form you just finished
and see what $15,000 or $20,000 additional gross does to your tax debt. That's what you'll pay next year. For many, it also puts you into a new higher bracket so it's even worse.

This is how the government is going to buy insurance for the15% that don't have insurance and it's only part of the tax increases.

Not believing this??? Here is a research of the summaries.....

On page 25 of 29: TITLE IX REVENUE
PROVISIONS- SUBTITLE A: REVENUE OFFSET PROVISIONS-(sec. 9001, as modified by sec. 10901) Sec.9002 "requires employers to include in the W-2 form of each employee the aggregate cost of applicable employer sponsored group health coverage that is excludable from the employees gross income."

Joan Pryde is the senior tax editor for the Kiplinger letters. Go to Kiplingers and read about 13 tax changes that could affect you. Number 3 is what is above.

The tree of liberty should be refreshed with blood!

I need a terminal disease first!

Excellent post, Speedy. Being out of the country, I was unaware of most of this.

I had been seeing it on a local level in my home city and figured it would only be a matter of time before it happened federally. This issue is simple, in a time of increased unemployment and reduced investments, there is simply far less money coming in yet people demand the same level of service. My property tax rate increased 10% last year. It will now go up another 10% this year. Thats a 20% increase in just 2 years!

Federal spending (also called "programs") likely averted a collapse of the entire financial system on this planet. A looming Great Depression, except now spread all over the globe. Had to be done. But when you have spending going up and revenues going down, its only sustainable for very short periods.

Hell of it is, the sytem is screwed up much worse than the average joe realizes... these measures wont even come close to fixing the problem... and no single politician is to blame. The system simply does not allow for them to be honest and say "Look folks, we've been living in an unsustainable way... multiple wars, reduced taxes, new govt depts (homeland defense? Think that's free?)... it just couldnt last. We have to start paying the piper."

The first person that stands up and says that is going to be kicked out of office immediately... to be replaced by someone who will tell us what we want to hear, that everything is fine.

Every time somebody says: "Somebody should do something about this." he should don't forget to add "... and I will gladly pay, no matter the cost".

Every law should end with the words: "Subject to unilateral change at any time" <<< important if you thought it is made for your benefit. The benefit can vanish in a New York Minute.

Every law, contract, form presented to you has the purpose to take a right you have away. once you sign it, or in case of law your elected representative obligates you.

What does the Emperor do when he needs more money. He taxes the territories. US intellectual ambassadors (Professors) are currently traveling around the world promoting in all countries outside the US a "Guaranteed minimum income" and are quick to suggest that "it could be funded easily if an international organization would be founded and be allowed to tax an itsy bitsy amount of 0.05% of peoples income". That was a real quote by the way. If any nation would be insane enough to open the door for international private organization to be empowered by legislation to tax their citizens, the itsy bitsy 0.05% will not stay that way for long. And of course, the country would have lost all sovereignty for ever.

still great rates compared to holland! and we dont even have 8000 billion debt or so :P

by the way how come so many americans have a problem with paying a bit more in order for everyone to receive proper healthcare? do they really rather let ppl die, so they can buy another suv?

My opinion only: I don't have any problem with "paying a bit more in order for everyone to receive proper healthcare". However, the current health care changes taking place in the U.S. see to primarily benefit the drug companies, the insurance companies, and other non health care providers. I don't see any cost containment measures such as minimizing the proliferation of very expensive diagnostic equipment that is duplicated in hospitals nearly adjacent to each other. I don't see any liability (attorneys) control. I think one of the reasons Panama health care is so inexpensive is the lack of lawsuits, expensive liability insurance, and the scarcity of expensive diagnostic equipment. Of course, lower wages is also a large part of the lower costs.
If I thought that patients would benefit by the health care changes taking place in the U.S. now, I'd be very supportive. I just don't think this is the case. The current system is crazy and I'm guessing it will get worse. For example, one of the ways the government intends to control costs is to mandate lower medicare/medicaid payments to health care providers. The result will be that honest, competent providers can't afford to provide the care while unscrupulous providers submit multiple bills for a single exam or procedure as well as submit bills for physicians who did not participate in the patient care. I'm aware of instances where these types of billings were reported, they were ignored. What waste and dishonesty!

Originally Posted by janl

how come so many americans have a problem with paying a bit more in order for everyone to receive proper healthcare?

In Europe you get value for your taxes. In America you don't.

The concept of government serving the people has changed to the people doing what the government want's them to do. What the US does with other countries, e.g. Panama, by forcing their will onto them, it also does to it's own people. For Americans, that never left the country the constitution is the only bench mark to realize their loss of rights.

This statement would qualify for the Darwin awards.... :-)

Originally Posted by speedy

I Europe you get value for your taxes. In America you don't.

Originally Posted by bicar

My opinion only: I don't have any problem with "paying a bit more in order for everyone to receive proper healthcare". However, the current health care changes taking place in the U.S. see to primarily benefit the drug companies, the insurance companies, and other non health care providers. I don't see any cost containment measures such as minimizing the proliferation of very expensive diagnostic equipment that is duplicated in hospitals nearly adjacent to each other. I don't see any liability (attorneys) control. I think one of the reasons Panama health care is so inexpensive is the lack of lawsuits, expensive liability insurance, and the scarcity of expensive diagnostic equipment. Of course, lower wages is also a large part of the lower costs.
If I thought that patients would benefit by the health care changes taking place in the U.S. now, I'd be very supportive. I just don't think this is the case. The current system is crazy and I'm guessing it will get worse. For example, one of the ways the government intends to control costs is to mandate lower medicare/medicaid payments to health care providers. The result will be that honest, competent providers can't afford to provide the care while unscrupulous providers submit multiple bills for a single exam or procedure as well as submit bills for physicians who did not participate in the patient care. I'm aware of instances where these types of billings were reported, they were ignored. What waste and dishonesty!

ok so basically u are saying that because theres many flaws in the healthcare system, poor people also shouldnt have access to it? seems to me those are two different subjects.

obviously healthcare in america has to be fixed, since its abt 5x more expensive as in europe, and with similar results, but the idea of paying a bit extra so the poor people can also have access to it sounds good to me. but then again.. im not american!

Originally Posted by speedy

I Europe you get value for your taxes. In America you don't.

i think that used to be true. we are now kinda following america, so less and less benefits and protection, but taxes staying high!

I know that there is this trend. It only shows how this corruption keeps creeping. There is a big misconception that the US is the force behind this. The US is only the execution arm of the forces behind this. As far as I am concerned, it is the same money that has financed all major wars of the last 500 years.

In Europe you obtain rights, in America you are granted privileges. The difference is that for any and no reason at all, you can be denied your benefits. In Europe, there used to be along term thinking and planning. In America you have no planning security what so ever. In addition, every paper you sign here can obligate you into a contract you don't even know applies to you.

get a social security number and you have signed away your rights. Not knowingly of course, but you have "voluntarily" made yourself subject to so many disadvantages that most will never know. Most importantly you became a cosigner on the US debt to said money forces. Sounds fantastic, but it requires a lot of studying to become aware of those "minor details".

It goes as far as tax laws not being shown, not even in court, because they a) may not exist, or b) may not be for the public eye. But yet, you are obligated to live by it. For Europeans, this sounds like a bad movie.

It also requires to understand the federal reserve system (FED) and the international monetary fund (IMF) to see things in a bigger picture.

In short, yes, they are willing to let people die.

But mind you, the problem is deeper than that. Few Americans actually know what socialism is, thus many are led by the corporate media to believe that Obama is a socialist. The corporate media (a handful of corporations own more than 90% of the media in the U.S.) is very powerful, and has produced extremely effective propaganda, persuading people to vote and think against their own self interest. That is why we have a health insurance system, as opposed to a health care system. Many Americans have been led to believe that the insurance industry is a good thing; they fail to realize that health insurance companies are merely parasitic institutional "middle men", without which health care could be provided to each and every U.S. citizen. The vast majority of every dollar allocated to health insurance in the U.S. goes to provide obscene salaries for the health insurance c.e.o.s.

Originally Posted by explorer

In short, yes, they are willing to let people die.

But mind you, the problem is deeper than that. Few Americans actually know what socialism is, thus many are led by the corporate media to believe that Obama is a socialist. The corporate media (a handful of corporations own more than 90% of the media in the U.S.) is very powerful, and has produced extremely effective propaganda, persuading people to vote and think against their own self interest. That is why we have a health insurance system, as opposed to a health care system. Many Americans have been led to believe that the insurance industry is a good thing; they fail to realize that health insurance companies are merely parasitic institutional "middle men", without which health care could be provided to each and every U.S. citizen. The vast majority of every dollar allocated to health insurance in the U.S. goes to provide obscene salaries for the health insurance c.e.o.s.

unfortunately we have also switched to insurance since abt 4 years. since then the monthly rate has gone about 6-8 times. still a bargain for most at around $150-200, but anything getting 8x more expensive sucks of course. and theyre startign to take things out of insurance now as well. so less for more!

Originally Posted by speedy

I know that there is this trend. It only shows how this corruption keeps creeping. There is a big misconception that the US is the force behind this. The US is only the execution arm of the forces behind this. As far as I am concerned, it is the same money that has financed all major wars of the last 500 years.

In Europe you obtain rights, in America you are granted privileges. The difference is that for any and no reason at all, you can be denied your benefits. In Europe, there used to be along term thinking and planning. In America you have no planning security what so ever. In addition, every paper you sign here can obligate you into a contract you don't even know applies to you.

get a social security number and you have signed away your rights. Not knowingly of course, but you have "voluntarily" made yourself subject to so many disadvantages that most will never know. Most importantly you became a cosigner on the US debt to said money forces. Sounds fantastic, but it requires a lot of studying to become aware of those "minor details".

It goes as far as tax laws not being shown, not even in court, because they a) may not exist, or b) may not be for the public eye. But yet, you are obligated to live by it. For Europeans, this sounds like a bad movie.

It also requires to understand the federal reserve system (FED) and the international monetary fund (IMF) to see things in a bigger picture.

omg that does really sound like bad movie :s but nothign surprises me anymore unfortunately!

There really is absolutely no good reason for health insurance companies to exist. They are profit driven, and as such are only concerned with the bottom line, even if it means sacrificing the well being of the insured. I, for one, would much rather fund a true "welfare state", than one that foments violence and conquest around the globe in order to obtain and retain profits. Unfortunately, it has become popular in the states to rail against the idea of the welfare state, yet corporate welfare is alive and well, supporting multinational corporations that do everything possible (successfully, I might add) to avoid paying any taxes at all in the U.S.

Any risk management must be disconnected between your ability to earn and the time of need. Insurance does not work that way, and for that you have no coverage in times of need. Welfare, funded as a portion of your income can do it, but only if it is administered responsibly and mandatory for all. Responsibly is the operating word, missing in the US, and for that it's not working either. It is very hard for Europeans and other nationalities to understand, that the system in the US is designed to take people to the cleaners and not to serve a practical purpose. Invite corporations into legislation and you lose it all.

Originally Posted by janl

ok so basically u are saying that because theres many flaws in the healthcare system, poor people also shouldnt have access to it? seems to me those are two different subjects.

obviously healthcare in america has to be fixed, since its abt 5x more expensive as in europe, and with similar results, but the idea of paying a bit extra so the poor people can also have access to it sounds good to me. but then again.. im not american!

That is not at all what I am saying. I'm just saying more money doesn't equate to more access. I don't think it is a matter of money to make health care more available; it is the structure of the system. It seems like the present business for many segments of business/industry is at the government's teat. For example, automobile companies, banks, insurance companies, etc. This is not the society of previous years and I don't think I like it. I don't think it is fair and I believe it harms people. People seem to be are the last concern.

Originally Posted by speedy

invite corporations into legislation and you lose it all.

absolutely.

Basically instead of spending trillions on air craft carriers and the wars in Iraq and running there 800 bases over seas, and having 3 carrier battle groups at all times threatening all the middle eastern nations, maybe that money should have been spent on job creation, health care and debt repayment, America would not find itself in the situation it is in now, it is only a matter of another 48 months before the whole system collapses anyways due to debt.

America is in shambles, and the only way they can even keep the ship afloat at this point is to go in debt 1.5 trillion a year forever, how much longer can this go on, while the same time they ran all the factories away due to high regulations and high taxes...

Has to end...

Health care is great when you are sick and need it.

That's why we have countries like The Netherlands and Denmark.

They cover whatever human garbage stumbles across the border.

I'll be sure to let you guys know when I need my procedures! It's my right and I thank you for fighting for me having this right and protesting in the streets when I don't!