Archive for November, 2012

First thought, taxes—proposed tax policies

1. Income tax (ordinary, individual income tax)

a. Current Rates                   b. Obama Proposed Rates            c. Romney Proposed Rates
10%                                                             10% (same)                                        8% (-2)
15                                                                 15 (same)                                         12 (-3)
25                                                                25 (same)                                         20 (-5)
28                                                                28 (same3)                                   22.4 (-5.6)
33                                                                36 (+3)                                          26.4 (-6.6)
35                                                           39.6 (+4.6)                                           28 (-7)

2. Capital Gains, Interest, Investments

a. Current rates:

Certain qualified dividends are currently taxed at capital gains rates, which are zero percent for taxpayers in the 10 percent and 15 percent tax brackets and 15 percent for all other taxpayers.

General interest earnings, i.e., on such investments as CDs, are taxed at ordinary tax rates.

Carried interest, i.e., the share of profits that private equity and hedge fund partners receive as compensation, is taxed at capital gains rates.

b. Obama’s Proposed:

Increase capital gains tax rate to 20 percent on high-earners. Impose the so-called Buffett rule, i.e., a minimum 30 percent tax on high-earners.

Dividends taxed as ordinary income for individuals with adjusted gross income of $200,000 ($250,000 for married couples filing jointly).

Carried interest taxed as ordinary income.

c. Romney’s Proposed:

Eliminate taxes on investment income for taxpayers with adjusted gross income of less than $200,000. Retain 15 percent tax on interest, dividends and capital gains for all other taxpayers.

3. Estate Tax

a. Current Rates:

Currently, estates worth up to $5.12 million are not taxed, with estates worth more than that taxed at 35 percent.

b. Obama’s Proposed:
Exempt estates worth up to $3.5 million and increase estate tax rate to 45 percent.

c. Romney’s Proposed:
Repeal estate tax permanently. This would enable estates worth any amount to pass from one party to the next with no tax.

The above is from bankrate.com and can be found at link here:
http://www.bankrate.com/finance/taxes/tax-proposals-obama-vs-romney.aspx

My two cents:

1. Income tax: I am so tired of this “tax the rich” and “make the rich pay their fair share” crap. I am far from rich, so I have no personal stake in this, but if you would do the research you would see that “the rich” are ALREADY paying a much larger percentage. Change you slogan to “sock it to the rich” and be honest about it, please. “Fair” does not mean “more”. Obama’s plans increase the rates on upper earners, Romney’s drops the rates on everybody, which is better than Obama’s plan but does NOT go far enough.  I am of the opinion that the entire system needs to be scrapped and replaced with a consumer type tax, but that is for another blog.

2. Estate tax: I don’t care if you are one of the “tax the rich” or “make the rich pay their fair share” clowns; there is no way you can seriously think there is anything FAIR (if you really THINK about it and you know the definition of the word “FAIR”) about the system as it is, let alone as Obama wants to change it. Someone works their lifetime to build something, paying income taxes on all they make along the way and sales taxes on all that they buy along the way as well as property taxes on all that they possess with the idea of passing this on to their descendents when they depart this life only to have the government, which taxed them their entire life, take 35 percent (or 45 percent proposed) when they die. Do you see anything FAIR about this? If so, you don’t know what FAIR means.

2. Second thought, retired military top officers overwhelmingly back Romney over Obama, despite recent news stories about Colin Powell’s endorsement. See link

http://godfatherpolitics.com/7881/retired-military-overwhelming-endorses-mitt-romney/

My two cents: Who better than retired senior officers to decide who would be a better commander in chief?

3. Third thought, likeability:

While 22 percent of Romney voters say they are backing him because they dislike the president, only 7 percent are backing Mr. Obama because they dislike Romney. CBS News

My two cents: A lot more voting AGAINST Obama should be something to think about.

Thanks for reading, please keep thinking.

Vaya Con Dios,

MBL

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