The Problem of Cutting Spending:

It's not, but we live here. It depends on what you get in return for your taxes. As you point out, BTA, it seems we don't get much in return, especially at the local level, where it seems that the more we pay, the local improvements are really just to increase income for the state. Now they want to put a charge on police and fire service, and other emergency services? What do we have them for? To make money for the state and its affiliates? Sweden is much better at it than we are, although its rate is still very high.

http://en.wikipedia.org/wiki/Taxation_in_Sweden

 

Well, it would definitely be lower at the very least. As I previously stated, I haven't done my taxes yet, so I may not recall correctly, but I think that children are worth $5500 as exemptions, meaning that for every child you have, you effectively have $5500 less taxable income. Exemptions count in addition to deductions, so regardless of whether yo itemize or take a standard deduction, yeah, you would have a significant amount of non-taxable income.

 

Please. The tea party's demographics measure up about evenly with the rest of the country in just about every conceivable area, and their median income is only slightly higher than the country at large. 19% of them (as opposed to 25% of the general population) were found to make less than 30K. 45% of them as opposed to 50% of the general population make less than 50K. It's impossible to pick up their tax returns and figure out their exact tax liability, but we can tell from this data that a very substantial subset of the 0-30K and the 30-49.9K groups will have zero income tax liability. Why? Because they always do. I'm not trying to pull a fast one, NOG, and I have no interest in playing "Gotcha!" either.

http://www.gallup.com/poll/127181/tea-partiers-fairly-mainstream-demographics.aspx

 

"No!"

 

That's right. Our gross income was a little higher than 49.9K. It was moving to the long form [with its deductions] that lowered our taxable income rate to the point that we didn't have any taxes.

 

With an AGI of around 50K and three kids it is more than possible to get your taxes down to zero. The married filing joint standard deduction in 2010 is $11,400 and if you itemized (filled in schedule A) you may have gotten even more. Combine that with exemptions, child care credits and child credits for three kids and you can get there.

 

Snook, how many legitimately wealthy Americans would you estimate belong to the 38% with no liability. I imagine the number is exceedingly low, but probably not non-existent. Could a real estate investor pull it off if the rent he charges on his properties were only enough to cover insurance, property tax, maintenance, the mortgage(s), and a modest cash flow?

 

That is kind of a misleading question because wealth and income are two totally different things. I have a lot of real estate clients and people who were invested in commercial real estate tended to do between poorly and abysmal in 2010. One guy comes to mind. His properties are probably worth $100 million, but in 2010 they generated a net loss (which is about $2 million less then 2009 and $4 million less then 2008). In his case he will pay the same federal taxes as Chandos, however I think it is a safe thing to say that he has a significantly higher standard of living then Chandos .

 

Good answer, and it was not my desire to be deceptive. My desire was merely to address the common assumption that the only people running around with no tax liability are the working poor and to get some clarity regarding at least one possible such means of accomplishing the feat. Day traders, venture capitalists, and even professional gamblers are also often subjected only to the capital gains tax.