<p>“I guess this explains the declining marriage rate. It makes better financial sense to be legally single.”</p>
<p>Sad, isn’t it. I guess us working women should just stay home in the kitchen… not that there’s anything wrong with that, but I can’t cook. My family will verify that.</p>
<p>I’m worried more about deductions than rate increases:</p>
<p>[New</a> Limits on Deductions Will Affect Many Taxpayers - WSJ.com](<a href=“New Limits on Deductions Will Affect Many Taxpayers - WSJ”>New Limits on Deductions Will Affect Many Taxpayers - WSJ)</p>
<p>And yes, the new rates do make me reluctant to take on some contract work. I’m noodling on it.</p>
<p>Wow, sewhappy, I finally meet someone who thinks about not working because of taxes. Up to now, I thought it was mainly a rhetoric. I would think one gets to keep what they earn if smaller portion.</p>
<p>^^Definitely not rhetoric. Many people can control their income by how much they work. We am paid on an hourly rate, and if the percentage of what we keep is too low (or if we work too much, we get thrown into a bracket that not only taxes us more but reduces deductions), the choice of how much to work gets easier.</p>
<p>For example, if you are one of those unlucky people who live in California, high tax, high cost of living…if you are in the highest tax bracket, on those dollars past a certain threshold, you could pay 39.6% federal + 2.9% payroll + additional healthcare taxes of 0.9% + 13.3% state= 56.7% tax rate. Then if it makes you lose some deductions, that just adds to it. There is definitely a point in which people will move or work less. Not everyone will work the same amount for higher taxes, they will change what they do one way or another.</p>
<p>Definitely, there are folks who have control over how many hours they work and what kind of work they do, to adjust their total family income, if circumstances make one scenario more attractive than another. In our case, it made financial sense for H to retire when he did because of the way his pension was calculated and other issues. </p>
<p>In HI, we also have very high tax and high cost of living, much like CA. We could also pay the highest federal AND payroll and worker’s comp and healthcare taxes and state taxes to end up with significant amounts. Our highest state tax rate is 11%.</p>
<p>Here’s a crazy thought – maybe at a certain point it is good policy to discourage work by some individuals so as to create more work for others. If sewhappy chooses to take fewer jobs because the marginal tax rate doesn’t make it worth it for her, that work is available for others who may not be as wonderful as sewhappy but may need the work just as much. Is the aim to allow a few people to amass as much wealth as possible, or to provide the opportunity for all people to have meaningful work? (Ok, I’m a socialist. I admit it.)</p>
<p>Interesting point. The job will be more attractive to people whose tax rate is 10-15%. How’s the tax rate compare historically? Is 39.6% on the high side or low side?</p>
<p>Some European countries do this by limiting the maximum number of hours that their employees work. It could create more jobs or just encourage off-shoring.</p>
<p>“Here’s a crazy thought – maybe at a certain point it is good policy to discourage work by some individuals so as to create more work for others. If sewhappy chooses to take fewer jobs because the marginal tax rate doesn’t make it worth it for her, that work is available for others who may not be as wonderful as sewhappy but may need the work just as much. Is the aim to allow a few people to amass as much wealth as possible, or to provide the opportunity for all people to have meaningful work?”</p>
<p>Things don’t always work out as well as it sounds in theory. As bceagle mentioned, look at some of the European countries. For example, take France, where they limited work weeks to 35 hours. It was expensive for companies, who avoided hiring new people and just demanded more productivity during that time. That was changed.</p>
<p>If I look at my job (both me and H do the same thing), and if my company either limited hours (they’d never do that) or if people like us decided to work less for the tax consequences, what would happen? The company would not hire more people, others already working at the job would pick up the hours (perhaps at a lower tax rate because they have a non-working spouse, or a company that allows them to take tax writeoffs). </p>
<p>So is that beneficial? They are paying less in taxes, the govt is getting less than it would otherwise. Many of these people are already working too much anyways, is it good for Dads to be away from their children more time, to increase their income? In our case, our kids are away at college, and we work 3/4 schedule anyways. Is it a good thing to encourage some people to work far more hours than others? Maybe if you think it is beneficial for workers to die early.</p>
<p>I fall into the category of allowing people to make their own choices, and the entire idea of govt policies to try to control people through tax policy always seems creepy. Though I realize that is entirely what our tax policy depends upon.</p>
<p>The people who tend to have more control over their income and hours tend to be pretty highly skilled and experienced, so their jobs would not easily be filled by someone off the street or a new college job with no experience. Of course this varies, but for those I know with this kind of flexiblity, they also tend to have unique skill sets that make them very attractive and able to excel.</p>
<p>
on the very low side over the last 60 years or so … [Income</a> tax in the United States - Wikipedia, the free encyclopedia](<a href=“http://en.wikipedia.org/wiki/Income_tax_in_the_United_States]Income”>Income tax in the United States - Wikipedia)</p>
<p>“on the very low side over the last 60 years or so”</p>
<p>I know that is a popular thought in some circles, but what is reality? For example, you could say, wow, people paid 94% top income tax rate in 1944, now that is high! But then again, if just about everything was deductible then, and only two people actually paid that rate…well, is that reality? I remember the good old days where you really could deduct just about anything (and I’m not even that old), and people made tax shelters into sport. And then when you add up state taxes (because they certainly haven’t gone up), rate increases are quite significant.</p>
<p>And then you can say, just from looking at your link, that top tax rates are now the highest they have been in the last 25 years (tied with 1993 rates, but look at state tax rates going up). That doesn’t really sound like they are on the very low side, though I know there are people out there that would love us to think otherwise.</p>
<p>If you look at the lowest tax bracket, rates are the lowest they have been in 75 years, though.</p>
<p>“In HI, we also have very high tax and high cost of living, much like CA. We could also pay the highest federal AND payroll and worker’s comp and healthcare taxes and state taxes to end up with significant amounts. Our highest state tax rate is 11%.”</p>
<p>Wow, that is high. If you include the cost of living, it’s a good thing you don’t have to travel anywhere like us cold weather folk, and can just go outside and lay on the beach for a vacation! How could people afford anything else!</p>
<p>Busdriver, your post #792 is so true. </p>
<p>The truth is that the income class below, say, 500K and above, say 250k, is essentially the cow they are going to bleed so long as it will give blood.</p>
<p>I’m in that “special” group. So good to be a happy citizen, sacrificing for my fellow man, etc.</p>
<p>The other shoe has dropped – its PEAS and PEP – and the whole bs about rates are just . . . bs.</p>
<p>Oh well.</p>
<p>I’m wondering why those who feel there isn’t enough taxation of us 250K+ers to assist others havent pushed this idea on organizations such as Ivies and other well endowed schools. If Harvard pulls in a couple of billions a year, why isn’t there a movement that they part with, say 40% of it, to help underfunded institutions so that they can be more generous in giving grants?</p>
<p>The way I look at it is not so much to assist others. People with comfortable income/wealth have a bigger stake in a functioning society imo. They have more to protect, their wealth, lifestyle. It makes sense people pay up in proportion to their income or wealth.</p>
<p>“The way I look at it is not so much to assist others. People with comfortable income/wealth have a bigger stake in a functioning society imo. They have more to protect, their wealth, lifestyle. It makes sense people pay up in proportion to their income or wealth.”</p>
<p>That doesn’t make sense to me. People who have great wealth actually have far less need in a functioning society than those who don’t. If something goes wrong, they can take care of themselves instead of depending upon the govt for their food, their health, their children’s school. their housing. Those who have little will need much more if society falls apart. Many wealthier people are already paying for their children’s private school, private roads, and not using public services nearly to the level of many others. I guarantee you, now that I am older and not poor any more, I am much farther away from needing anything from the govt than I used to be.</p>
<p>Do you think that because someone has more money in their bank account that their life is of more value than someone who doesn’t?</p>
<p>
If we look at the essentials - food, shelter, education, etc are you recommending we assign a reasonable percentage for each, say 10% for food, 25% for shelter whatever, and A pay $20/gal milk while B pays 2 bucks; for the same house, A pays a 10 grand mortgage, while B pays 1,000.</p>
<p>Back to tuitions, why is it similarly not desirable for Harvard to part with a good chunk of its income so that some lesser school can have more options so that we have a “better functioning” education system?</p>
<p>I don’t agree that wealthy people need less from the society. They need the infrastucture to make their money in the first place. They can work 100 times harder in an unhabited island without making a penny. They need consumers, they need suppliers, they need financial infrastructure to flurish. They also need to be entertained and protected. They can hire private security and lock themselves in if you can call that satisfying life. My money, my life, my way is not a qualified life imo. They can build a few airpot to fly their private jet but can they build thousands of them to go anywhere/anytime they want to go? Where can drive their beloved sports car? Pave a thin strip of a road and maintain it? Poor people don’t need any of that. Their life is limited. They don’t need banks, cash will do. They don’t travel far. Utility, they probably use far less. What portion of infrastructure do they use more other than ER? Why do we need chinese market? We have everything we need as the richest nation, don’t we?</p>
<p>About highly paid/highly skilled workers being irreplacable as someone mentioned upthread. I am sure that’s the case of people who write on this board. In my limited experience with highly skilled highly paid consultants, they were quite replacable. I am assuming they were highly skilled since they chagred close to $1000/hour. Theye weren’t all that helpful. I could dig deep and narrow on my partucular issue and in the end, I had a better understanding than they.</p>