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Post 09 Mar 2019, 11:04 pm

geojanes wrote:
bbauska wrote:OK, Here is the data. AGI difference is negligible between 2017 and 2018 taxes.

Tax owed was $1500 less this tax year (2018). Seems like the tax plan put forth from the administration saved me (a middle class family) $125/month. I am happy about that.


That's pretty darn good. Good for you!

Did you itemize your deductions in either year? I think for most folks who took the standard deduction in 2017 they're going to be saving money in 2018.


Actually, I did not take the itemized route. My house is almost paid off, and the interest reduction made it less than the standard deduction. The charitable contributions made some difference, but not enough to warrant the itemization.

Taxes were less this year. Only if they Federal budget would be reduced as well, we could be heading to more solvency.
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Post 11 Mar 2019, 1:36 pm

I'm hoping others will also share their experience. I will, but it won't be until next month.
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Post 30 Mar 2019, 6:49 am

Just finished mine … the tax bite is about the same … on the one hand I lost all sorts of itemized deductions like state taxes … on the other hand I qualify for the new 20% Qualified Business Income deduction. Losing exemption for a family of 4 hurts; the child tax credit is not fair compensation because it is only for kids under 17. I have every reason to believe that I will support my kids through college, but hopefully not after that. The lower rates are a plus. So, these competing factors basically wash for my personal situation. I still believe in the tax reform as it relates to corporations. The economy is benefiting from that.

This is the first time I have not itemized since at least 1985 when I got my first professional job. That does result in simplification. I didn't have to figure out my charitable contributions or misc. investment expenses, etc. On the flip side I must say that the 5 new schedules that I am now required to file is a real pain in the ass. Trump promised to make the 1040 fit on one page, and as a result I have 5 extra pages that go with my return including an entire page for nonrefundable credits, another page for self employment tax and an entire page for estimated tax payments. What were they thinking?
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Post 09 Apr 2019, 11:21 am

Ray Jay wrote:Just finished mine … the tax bite is about the same … on the one hand I lost all sorts of itemized deductions like state taxes … on the other hand I qualify for the new 20% Qualified Business Income deduction. Losing exemption for a family of 4 hurts; the child tax credit is not fair compensation because it is only for kids under 17. I have every reason to believe that I will support my kids through college, but hopefully not after that. The lower rates are a plus. So, these competing factors basically wash for my personal situation. I still believe in the tax reform as it relates to corporations. The economy is benefiting from that.

This is the first time I have not itemized since at least 1985 when I got my first professional job. That does result in simplification. I didn't have to figure out my charitable contributions or misc. investment expenses, etc. On the flip side I must say that the 5 new schedules that I am now required to file is a real pain in the ass. Trump promised to make the 1040 fit on one page, and as a result I have 5 extra pages that go with my return including an entire page for nonrefundable credits, another page for self employment tax and an entire page for estimated tax payments. What were they thinking?


My personal situation was similar. I lost a host of deductions, and, like RJ didn't itemize for the first time since goodness knows (though I tried, it just didn't turn out in my favor.)

My rate went up but not as much as I expected, but my income also went up, so it's hard to tease out exactly what the impact of tax reform was.

As I've reported in the past my effective federal tax rate over the years is as follows (Federal income tax/AGI):

2003: 23.6%
2004: 25.8%
2005: 26.3%
2006: 26.4%
2007: 28.4%
2008: 26.5%
2009: 26.5%
2010: 17.7%
2011: 13.1%
2012: 4.5%
2013: 6.4%
2014: 12.0%
2015: 6.5%
2016: 7.6%
2017: 12.8%
2018: 13.4%

So my rate went up 0.6 percentage points from the previous year, and is the most I've paid (as a percentage) since 2010, but it's not out of line and no where near what I used to pay. I really thought I would fare much worse and am pleased to only be paying 0.6% percentage points more.
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Post 23 Jul 2019, 11:08 am

So nice that once the Republicans got control of the White House, the era of fiscal responsibility would begin. Long Live The Tea Party!

https://www-m.cnn.com/2019/07/23/politi ... ick-access

The Tea Party started and ended when the Black Man had control of the money...
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Post 23 Jul 2019, 4:16 pm

freeman3 wrote:So nice that once the Republicans got control of the White House, the era of fiscal responsibility would begin. Long Live The Tea Party!

https://www-m.cnn.com/2019/07/23/politi ... ick-access

The Tea Party started and ended when the Black Man had control of the money...


And here I thought race didn't matter...
Sadly, the Republicans are no better than the Democrats when it comes to spending.
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Post 21 Dec 2019, 2:05 pm

This article claims Trumpanomics has not moved the needle much. Is it wrong?

https://www.cnn.com/2019/12/20/perspect ... index.html
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Post 22 Dec 2019, 7:21 am

freeman3 wrote:This article claims Trumpanomics has not moved the needle much. Is it wrong?

https://www.cnn.com/2019/12/20/perspect ... index.html


It's certainly a much too simplistic determination in the real world. The tax cuts are important, but so is the trade war, the international economy, and where we are on the economic growth cycle.

We have record low unemployment and record high employment; we have a continually growing economy. The government took in more revenue in 2018 than 2017, and it took in more revenue in 2019 than 2018, in both cases even after taking inflation into account.

P.S. With deficits climbing thru the roof, I find it amazing that Democrats are talking about substantially more spending and Republicans are talking about more tax cuts ...
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Post 23 Dec 2019, 7:36 am

It's good that we have a stable, growing economy and that unemployment is low. But all those tax cuts and cutting off regulations was supposed to get our economy to grow at 3 percent. And while we got a brief surge from that...growth is now back to our normal 2.5 growth rate. Which makes sense because corporate investment is actually down, because for one thing we did not tie any tax cuts to corporate investment. And there was nothing that Trump did that might increase productivity, which really might increase GDP. Those tax cuts will not change our GDP growth long-term...but they did leave us higher deficits. This has been Republican economic policy from Reagan to Bush II...to Trump. And has been a major cause of wealth stratification.

Throwing money at corporations and high earners...just gave the wealthy more money. Again.
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Post 23 Dec 2019, 8:41 am

I kind of have this idea of using tax policy to drive better treatment of workers. If a corporation meets certain benchmarks for treatment of workers and/or investment they would get a low tax rate. And small companies (with little bargaining power with workers)would get little regulation, whereas larger companies would face more requirements (and those in monopolistic or oligopolist industry would be strictly regulated). Without unions and globalization providing an oversupply of labor, right now there is no path for the majority of workers to share in economic prosperity like occurred from the 1930s to the 1970s.
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Post 23 Dec 2019, 10:46 am

Median worker wages since Trump took office have increased substantially. The US leads the developed world in GDP growth. Maintaining this level of economic prosperity late in the economic cycle while the rest of the west suffers (and does not help us move forward) is a real achievement.
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Post 23 Dec 2019, 12:06 pm

The subject of growth in wages is, to put it lightly, a very complicated subject. I find the following article to be highly informative and, I think, non-partisan. When you factor inflation into it, I am not sure Trump distinguishes himself from earlier presidents with regard to wage growth among your average worker. But there is an argument on nominal growth in wages.

By the way, I think a central argument against doing these tax cuts was that we were in a long economic recovery. Better to save those tools for when we are in a recession. It is worthwhile to run deficits when you are in a recession, but running deficits to stimulate an economy in a long recovery is very questionable. So taking credit for the economy continuing to hum along when you primed it with unnecessary deficits is also questionable . What's going to happen when a recession comes along and we already have huge deficits?

Here's the article:

https://www.factcheck.org/2019/06/are-w ... g-or-flat/
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Post 23 Dec 2019, 12:30 pm

freeman3 wrote:Those tax cuts will not change our GDP growth long-term...but they did leave us higher deficits. This has been Republican economic policy from Reagan to Bush II...to Trump. And has been a major cause of wealth stratification.

Throwing money at corporations and high earners...just gave the wealthy more money. Again.


I generally agree with you, but I will also say that the corporate tax change is more complex than this take. The USA had some of the highest corporate tax rates in the world, and it was much higher than some places, and so we were seeing crazy corporate strategies that were driven solely by tax policy, which no one wants to see. The huge reduction in the rate, which puts the US more in line with Europe means we're seeing a lot less of that crazy behavior, which over the very long term might pay dividends. Will it be more than what the cut was? Probably not, but I think we would all like to see a convergence of corporate tax rates globally, and the USA was an outlier on the high side.

Where the USA is really failing when it comes to taxes are in inter-generational transfers. That would do a lot to fight the oligarchic tendency of many of the most wealthy families.
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Post 23 Dec 2019, 1:00 pm

Giving Amazon 129 million dollars back from government coffers while they paid no federal tax in 2018 on 11 billion in profits says we have not exactly solved the corporate tax problem. We could have allowed corporations to deduct for investment or not dropped the rate so low. Corporations were doing just fine (see Dow the past 30 years) before we dramatically reduced the rate. Sure, we were a bit of outlier on corporate tax rates, but other countries with lower rates also take care of their workers better (vacation, health care, hours worked, wages, etc.), so a lower rate is ok. Workers' share of gross domestic income is close to a 60 year low.

https://fred.stlouisfed.org/series/W270RE1A156NBE

For me, making sure that workers get a larger share of the economic pie is more important than corporate tax cuts.

And I agree about untaxed inter-generational transfers being problematic. That gives too much of an advantage to wealthy kids. Of course, that is also made worse by economic policies that have fostered wealth going towards the top. And of course with some of that wealth you can keep lobbying for more policies that benefit the wealthy. We have a mess and it is going to be very difficult to fix.
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Post 23 Dec 2019, 3:42 pm

I am fine with a 10% tax across the board on all corporations and all individuals. The government should not be picking winners and losers. The field should be level in the way the government standards are applied to all.

When it comes to "inter-generational" wealth, that is a government intrusion upon what I do with my money. If I choose to give it to my children, and it is money that has been earned and already taxed, why should the government be allowed to tax it once again? That is taking two bites at the apple, so to speak.