Already Looking forward to 2011!!!

[Frixxxx]

Of course- hiring 70,000 people along the coast of the Gulf of Mexico, and using BP's money instead of taxpayer money- that sounds like a pretty good deal to me. Too bad it takes a disaster to hire that many folks. I heard that number being floated today as a possible number that BP will end up hiring. So far they've hired over 2,000, and are lining up 700 shrimp boats and small vessels to deploy oil booms. I guess that will make up for some of that loss of shrimping, eh?

Also sounds like an excuse to go to war?:suspicious: Wait, were already there....IRAN?

 

[tsptalk]

You have to wonder what this is going to do to stocks over the 2nd half of the year...​

Six Months to Go​

- 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%​

Read more: http://www.atr.org/six-months-untilbr-largest-tax-hikes-a5171##ixzz0sXtHYopD

 

[Bullitt]

This will devastate the market. No incentive anymore to 'invest for the long run' with lower LT tax rates. Good news is, the next bull market will probably begin the day a newly elected official announces a return to handsome tax incentives for long term shareholders.

 

[Boghie]

To All,

I should have re-read my own thread in May or June. Everyone knows the market looks six to nine months out. What do we investors see

Expect a blip in corporate income tax as they prepare to pay out the last of the Bush era dividends. After this blip many investors will demand that companies ‘pay’ them in capital gains. Capital gains taxes are going up – but not as fast as dividend taxes. Expect companies to ‘unexpectedly’ project reduced earnings as they move numbers around on the balance sheet. I have <sarcasm>absolutely no idea</sarcasm> what that will do to the market. Which company will employ ENRON accounting techniques first – I mean, of course, after the Federal Government.

Just a side note: The corpulent wealthy are already paying into the ObamaCare ‘lock box’. I can’t find that line item on the MTS. By chance, have the ObamaCare taxes on the war criminal wealthy accidentally been placed in the Social Security ‘lock box’. Things can’t get better…


Silverbird,

It is July 2, 2010 and still no Congressional action adjusting the coming tax code to limit the rate increases only on the unearned gains of the corpulent wealthy!!!

Get ready for the Marriage Penalty

Oh no, Mr. Bill

 

[grandma]

Get ready for the Marriage Penalty

I find it difficult to believe that this administration would actually remove an important plank in the GL drive toward marriage!
...unless this particular item is one of those with multiple exceptions ???:suspicious:

 

[PessOptimist]

Please explain the GL reference. I"m pretty stupid. Does it matter who or what you are married to? I am not going to read back many pages to figure out what you are talking about.

 

[Boghie]

I don't know what GL is???

The Bush tax code changes removed the compressed tax brackets for folks 'married, filing jointly'. Basically, till the Bush tax code changes took hold married couples did not get the equivalent of two deductions and the tax brackets were not double that of singles - they were 1.5 that of singles. If both partners worked than the effective tax rate of a married couple was much higher than that of two singles.

An example...

A poor gubmint slug marries a lovely lady in October 2001. When you look at their tax as singles they are good to go since they have been withholding Federal taxes as single and 1 withholding. However, marriage treated these poor sods rather shabbily in the last year of the marriage penalty. They end up charging up more than $3K on a credit card to pay The Man. The standard deduction was smaller and the tax brackets were compressed (leaving these poor sods with more earnings taxed at a higher level).

Another example…

The bucolic ‘Peoples Republic of Kalefornea’ never got rid of the marriage penalty. Obviously, the marriage penalty only affects the greedy corpulent rich ba$st@rds. But, why does the above happily married middle class couple have to add extra money to their Kalefornea state income tax withholdings. It must be a mystery.

I seem to have lived the dream.

 

[grandma]

Please explain the GL reference. I'm pretty stupid. Does it matter who or what you are married to? I am not going to read back many pages to figure out what you are talking about.

My apologies, PO, you definitely aren't stupid, and reading past posts wouldn't help. It is my error.:embarrest:
Either my typing was going faster than my mind, or my `short-cut' thinking inadvertently left off the rest - it was supposed to read `GLBT.' The GLAA (gay lesbian activist alliance) is among those who have been working hard to get their couples recognized as married, so as to: be treated equally as heterosexual couples. And now that will not be a plank in their platform.
However, with all the exceptions we hear about being written into various laws, is it not possible that the GLAA will be able to get an exception written into this tax code so as to continue preferential treatment?

 

[Boghie]

My apologies, PO, you definitely aren't stupid, and reading past posts wouldn't help. It is my error.:embarrest:
Either my typing was going faster than my mind, or my `short-cut' thinking inadvertently left off the rest - it was supposed to read `GLBT.' The GLAA (gay lesbian activist alliance) is among those who have been working hard to get their couples recognized as married, so as to: be treated equally as heterosexual couples. And now that will not be a plank in their platform.
However, with all the exceptions we hear about being written into various laws, is it not possible that the GLAA will be able to get an exception written into this tax code so as to continue preferential treatment?

Grandma,

There are two end-games as I see it:

1. Congress and the President will adjust the upcoming re-establishment of the Clinton Era tax brackets to not affect those in the current 10%/15%/25%/28% brackets - ie., the Middle Class (those making less than $210,000 married, filling jointly). The Marriage Penalty is not integral to this, but might be resolved at the same time. And, the higher taxes on dividends, capital gains, and inheritance are all desired by this Administration and this Congress regardless of the income tax rates.
2. Congress will not be able to find the votes to restrict the revenue stream of their dreams – since the majority cannot cut any meaningful spending (which has increased by over 25% since May 2007 and is now ‘baked into’ the spending cake as ongoing expenses). The majority in Congress will claim that increased taxes are pain we all must endure to finance all the necessary 25% spending growth accrued over the past 3 years. Will the President veto such a bill? The minority will yell and scream, but get nothing through. It will be even worse if the majority becomes a lame duck majority.

Actually, since our current crop of Congressional ‘Profiles in Courage!’ cannot even provide President Obama a budget my guess is that confusion will reign supreme. The current majority will be split. There will be a clamor for spending cuts that they cannot (and many desire not) bring to fruition since elephant in the living room is salary and pension and entitlement expenses. There will be a clamor for benefit extension they cannot refuse since they cannot be seen as throwing grandma from the train. Some will not be able to vote to limit the tax increases only to the extremely rich corpulent capitalist bankers because revenue projections will show just how small the deficit differential will be!!! If they do so than the minority party will have hard numbers to work with for the November election. So, my guess is that our ‘Profiles in Courage!’ will do nothing. And by doing nothing you will get everything.

The refrain will be: We all did well under the Clinton Tax Code!!!
My response is: I hope none of you need that extra hundred (couple hundred) in take home pay. We don't have mortgages!!!

On marriage. My guess is that gay couples and straight couples will soon avoid marriage like a plague!!!

 

[grandma]

Grandma,
On marriage. My guess is that gay couples and straight couples will soon avoid marriage like a plague!!!

It doesn't seem like it was `that long ago' that the single `oldsters' were moving away from their home states, away from close family so as to live the married life without benefit of marriage licenses, ceremonies, & embarrassing their kids & grandkids, because one or both would lose a survival check they were receiving as a benefit from their deceased spouse. There wouldn't be enough income to live on, pay medicines, etc., as a legally married couple.
That appears to be going to get `unfixed.'
So ? ...no more unhappiness with fellows who don't marry the mother of their children, who come & go to the home, so that the `wife' can collect a check for each of the kids growing up without the male influence or as a stalwart role model....?

 

[alevin]

Well, Grandma, that may be the case for those already inclined not to marry for some reason (the reason's are not all bad-some dads were just an accident in the first place and not worth marrying-there's one like that in my extended family-and no state support was ever requested either in that case), but

OTH, there will be those who are maritally inclined -and who want or have children already. if there is one wage-earner in the couple with viable income and benefits, and couple couldn't afford 3d party childcare even if the other spouse is working (due to insufficient income), it is starting to make sense for the second spouse to stay home to provide the otherwise unaffordable childcare. So no marriage penalty there.

That's true with my nephew and his wife-to-be (they're just waiting for family to get there, to have the ceremony, but they've already decided together he is the stay-at-home parent).

 

[Boghie]

Grandma, Alevin,

Its not an 'inclination to marry' thing. If both members of a couple are earning income as of January 2011 than the 'marriage penalty' will inflict a 20% increase in actual tax payments. The marriage penalty is not the only part of the increase. The general income rate increase also plays a role.

My example in the initial post of this thread is a real life example.

Some beautiful couples will ask: Why get married if it means paying Uncle Sam another 15% - 20%. Think back to the era of Clinton. Didn't we all know couples who made this call.

 

[Boghie]

Getting Back On Track...

Wow, this thread got popular.

Does that mean we are all a bit concerned about 2011? Nah, of course not. We'll just bump into that palm tree when we get to it - sometime around the first pay period of 2011. Yuk, yuk.

Anyway, to get folks back on topic (not really a social thread - the numbers speak for themselves) here is what the tax code changes mean to you:

I used an inflation adjusted tax bracket from 2000 to estimate the 2011 tax brackets in 2009 dollars.

It is amazing that there is so much uncertainty left with less than six months till implementation. Will there be a marriage penalty? If so, will it be limited to the highest tiers? Will the poorest earners really get a 50% increase in their tax rate? Will the corporate tax rates increase (note: under Bush corporate tax revenue dramatically increased)? What will happen to inheritance? What about dividends and capital gains? Do the child credits revert? Renter’s credit? All of those questions – if left unanswered – will make my chart’s numbers worse. My chart assumed full standard deductions and didn’t take into account dividends and capital gains. It didn’t take into affect the new taxes for ObamaCare (some already in place).

As they say, your first 2011 pay period take home pay could be dramatically worse.

Get out of debt, and get more cash flow.

Enjoy.

 

[crws]

Re: Getting Back On Track...

that's easy-
just need to make less... say 29950:laugh:

Wow, this thread got popular.

Does that mean we are all a bit concerned about 2011? Nah, of course not. We'll just bump into that palm tree when we get to it - sometime around the first pay period of 2011. Yuk, yuk.

Anyway, to get folks back on topic (not really a social thread - the numbers speak for themselves) here is what the tax code changes mean to you:

I used an inflation adjusted tax bracket from 2000 to estimate the 2011 tax brackets in 2009 dollars.

It is amazing that there is so much uncertainty left with less than six months till implementation. Will there be a marriage penalty? If so, will it be limited to the highest tiers? Will the poorest earners really get a 50% increase in their tax rate? Will the corporate tax rates increase (note: under Bush corporate tax revenue dramatically increased)? What will happen to inheritance? What about dividends and capital gains? Do the child credits revert? Renter’s credit? All of those questions – if left unanswered – will make my chart’s numbers worse. My chart assumed full standard deductions and didn’t take into account dividends and capital gains. It didn’t take into affect the new taxes for ObamaCare (some already in place).

As they say, your first 2011 pay period take home pay could be dramatically worse.

Get out of debt, and get more cash flow.

Enjoy.

 

[alevin]

OK, Boghie, back on topic. Last year (08 taxes) I had to write a check to IRS for the first time ever-thanks to having paid off my house early in the year, needing to rebuild emergency cash stash and save for new roof (those were priority over stashing the former mort payments into TSP).

this year (09 taxes) I had to pay a much smaller extra check due to putting more into TSP late in the year (after finishing saving up for new roof and Roth).

So now for 2010, I figured out how much extra to make sure I put into TSP to at least not have to pay more than is being withheld, and still have enough spare change to fully fund a Roth for 2010.

Any tax increase this next year will be countered by another bump into my TSP to offset. Will still get the Roth done too, just have to tighten the belt down harder on the household budget.

 

[Boghie]

OK, Boghie, back on topic. Last year (08 taxes) I had to write a check to IRS for the first time ever-thanks to having paid off my house early in the year, needing to rebuild emergency cash stash and save for new roof (those were priority over stashing the former mort payments into TSP).

this year (09 taxes) I had to pay a much smaller extra check due to putting more into TSP late in the year (after finishing saving up for new roof and Roth).

So now for 2010, I figured out how much extra to make sure I put into TSP to at least not have to pay more than is being withheld, and still have enough spare change to fully fund a Roth for 2010.

Any tax increase this next year will be countered by another bump into my TSP to offset. Will still get the Roth done too, just have to tighten the belt down harder on the household budget.

Alevin,

The tax code hasn't really changed for 2010 earnings.

Its the money you make in 2011. Also, if they don't fix the marriage penalty figuring our your tax will be a pain.

I like the way you do things!!!

 

[Boghie]

Just a Thought...

Say we Gubmint Types only get the Cost of Living increase for calendar year 2011. Maybe we are at a Step 10. Whatever...

So, this years mighty salary raise will be about 1%!!!!

What happens if your taxes go up 3%!!!

Tough to figure out...

 

[Birchtree]

I got a friendly notice from my friends at the IRS last week saying that I hadn't paid my tax. Good thing I could down load the paid check - sent it to them to verify the error was not mine. They must have given credit to another account.

 

[crws]

I got a friendly notice from my friends at the IRS last week saying that I hadn't paid my tax. Good thing I could down load the paid check - sent it to them to verify the error was not mine. They must have given credit to another account.

Any of your neighbors driving a new Lexus? or 2?
-Hey, btw, thanks for contributing to the security of my retirement.

 

[Boghie]

What will the Obama Tax Treatment Cost You???

Re(1): '2011 INCOME TAX CALCULATOR', The Tax Foundation

What will the Obama tax treatment cost you?

Here is the first decent tax calculator I have found...

Be a bit careful. The wages fields are for taxable income - not gross. I hope:worried:

Given that I entered taxable income into the wages field I will only pay an additional $100 / pay period (~$215/month) into the Federal Government Maw...

It is now July 24, 2010 and Congress still has not adjusted the impending tax code to limit the pain on those of us making something less than Big Money... Maybe big money will be having a salary:nuts: