Rick Perry's plan calls for Forbes Flat tax. Great plan!

pineinthegrass wrote: Amazing how excited you get about a plan we know so little about, Viking.

But a 17% flat tax with zero capital gains tax is a major tax cut for the wealthy. It's nice, that unlike the 9-9-9 plan, there is an exemption which protects the lower income people. But that just means the middle class will have to pay even more to make up for the tax cut for the wealthy. And the extremely rich who make over $1 million a year, most of which is capital gains, get to pay zero.

Great. So far two of the GOP front runners want to cut taxes for the rich, and raise taxes for the middle class.

Just because a middle class person is in the 25% or 28% tax bracket, it doesn't mean that's what they end up paying. After exemptions and the stuff Perry wants to get rid of like deductions and credits, the middle class usually ends up paying below 10%.

Let's just learn more about the specifics.

Agreed, let's look at the specifics. And capital gains and savings don't get taxed for the middle class either. they can save up a lot more for retirement.

The Viking wrote:

archer wrote: 17% tax on those who make over $36k is a HUGE increase on the middle class.

Ummmm what tax code are you looking at? You libs make up so many lies and don't back it up. How is it a HUGE increase? and that is not the final number yet. They are still working it out.

Single up to $8500 pay 10% now and it goes to 0%. Between $8500 and $34,500 pay 15% now and it goes to 0%
Between $35,000 and $83,600 pay 25% and it goes DOWN to 17%. In case you don't know math. 17% is less than 25% and 0 is less than 10 or 15%. And that to most is still middle class.

SO seriously don't just throw out random posts that are not true.

You are ignoring the fact that with current tax policy, a family of 4 already has about a $14,800 exemption. Plus they get a $2000 credit for two children. That alone is close to the $36K you are guessing about. Humm... I guess that's where the flat tax exemption for a family of 4 came from?

And lower income people currently can get thousands more back with the earned income credit.

A flat tax would get rid of the the child tax credit and earned income credit assuming Congress doesn't monkey with it.

Again as you agree, let's see the details, then we can produce specific examples.

SS109 wrote:

towermonkey wrote: More tax breaks for the rich and more taxes for the lower and middle class. Great plan...

Anyone who earns over $36,000 on this Earth is a 1%'r and should pay their fair share.

Love your new avatar.
He scared the hell out of me as a kid.

Viking, even you are smart enough to know that with the standard deductions, child deductions, school, and mortgage, and medical expenses, and RE taxes, the majority of Americans who are middle class pay far less than the tax code would indicate. I think it would be rare that a family making $36k/year would pay any tax. You are comparing adjusted gross income for the current tax code rates vs gross income for a flat tax. Apples and oranges my friend.You are completely ignoring the deductions and credits in your "math". I can't believe you actually believe what you just posted.....

What I posted IS true, and was no random post........most people with $36k/year gross income pay little or no taxes, 17% WILL be a huge increase.

How do I know this....preparing tax returns and accounting is what I did for a living, along with running a business. I don't comment on stuff like this without knowing what I am talking about.

archer wrote: Viking, even you are smart enough to know that with the standard deductions, child deductions, school, and mortgage, and medical expenses, and RE taxes, the majority of Americans who are middle class pay far less than the tax code would indicate. I think it would be rare that a family making $36k/year would pay any tax. You are comparing adjusted gross income for the current tax code rates vs gross income for a flat tax. Apples and oranges my friend.You are completely ignoring the deductions and credits in your "math". I can't believe you actually believe what you just posted.....

What I posted IS true, and was no random post........most people with $36k/year gross income pay little or no taxes, 17% WILL be a huge increase.

How do I know this....preparing tax returns and accounting is what I did for a living, along with running a business. I don't comment on stuff like this without knowing what I am talking about.

Who said there people lose child deductions? Under Forbes in 98 they actually went UP to $5000 per child and $13,000 per adult deduction. So it is actually better if he follows Forbes plan.
Under Cain's child deductions go away and no bottom on the 9%. This plan is a homerun compared to that one.

This was Forbes plan which Perry is looking at. many deductions and more for single mothers to help them out. I hope he uses these examples.

Under our current income tax system, there are six tax brackets ranging from 10 to 35 percent and, as Forbes rightly says, "an avalanche of different personal exemptions and deductions." Under Forbes's proposed flat tax scheme, there would be "a single-rate federal income tax and corporate tax of 17 percent." There would no longer be any taxes on capital gains, Social Security benefits, interest earned, or dividends received.

Additionally, the estate tax and the Alternative Minimum tax would be done away with. Individuals would have "generous exemptions for adults and children" such as deductions of $13,200 for adults and $4,000 for dependents. Single mothers fare even better. They receive an exemption of $17,160 instead of the normal $13,200. Corporations could expense all investments — no more depreciation schedules (at least for tax purposes, accounting is another matter) — and would only be taxed on what they made in the United States.

As expected, Forbes believes that the adoption of his flat tax will

•Make us more prosperous.
•Invigorate the economy.
•Make us more competitive overseas.
•Give rise to a strong, innovative, and dynamic economy.
"The flat tax will free America," he says, "It will liberate us, as individuals and as a society, from the tyranny of the federal tax code." That may be true, but it should be noted that because it is only a replacement for the federal income tax, the flat tax will not eliminate Social Security taxes, Medicare taxes, or federal excise taxes. And neither will it have any effect on state and local taxes. But to his credit, Forbes does not make any grandiose claims for the flat tax like we read about a national sales tax in publications like The FairTax Book.

The Viking wrote: Who said there people lose child deductions? Under Forbes in 98 they actually went UP to $5000 per child and $13,000 per adult deduction. So it is actually better if he follows Forbes plan.
Under Cain's child deductions go away and no bottom on the 9%. This plan is a homerun compared to that one.

What you describe is not a true flat tax, so I guess we wait and see exactly what Perry is talking about (I think we have to wait till his advisers explain it him, so he can understand it before he can explain it to us). Cain's is more the true flat tax, with no deductions. If what you say is true about Perry's so-called flat tax, that there are deductions and exceptions, then it become just one more graduated tax, and will be tweaked beyond all recognition by future congresses.

We agree that Cains 999 plan is flawed,

archer wrote:

The Viking wrote: Who said there people lose child deductions? Under Forbes in 98 they actually went UP to $5000 per child and $13,000 per adult deduction. So it is actually better if he follows Forbes plan.
Under Cain's child deductions go away and no bottom on the 9%. This plan is a homerun compared to that one.

What you describe is not a true flat tax, so I guess we wait and see exactly what Perry is talking about (I think we have to wait till his advisers explain it him, so he can understand it before he can explain it to us). Cain's is more the true flat tax, with no deductions. If what you say is true about Perry's so-called flat tax, that there are deductions and exceptions, then it become just one more graduated tax, and will be tweaked beyond all recognition by future congresses.

We agree that Cains 999 plan is flawed,

Yes we need to wait and see what he finally ends up with in the plan. But I like that two candidates want to get rid of 3 million words of tax code and maybe the majority of the IRS if now all of it!

I want nothing more than to be able to trash the current tax code....it takes up too much space on a shelf, But really, even the IRS agents, no matter how experienced, have no real idea of what is in it.....and if you call them with a complicated question, you will get passed from agent to agent, on to their legal department, and then be told do whatever you think is best, because they really don't know.

What replaces it is key, and from what I have read of Forbes' original flat tax, even with the deductions and credits it was a gift to the wealthiest Americans. Like I said, it wasn't a true flat tax but a modified flat tax, and still open to interpretation. It also exempted some of the greatest sources of income for the wealthy. Basically is is a flat tax on wages, not income, and that can open up a whole new can of worms. How income is reported, and what is reported as income has always been a great way to avoid taxes, the flat tax on wages opens the door for a lot of abuse on the income of high ranking managers, CEO's etc, the very people who now have the greatest ability to avoid taxes.

If there is even a hint that any new tax reform is advantageous to the wealthy at the expense of the middle class, it will never fly, and the candidate that promotes it will fail with it.

archer wrote: I want nothing more than to be able to trash the current tax code....it takes up too much space on a shelf, But really, even the IRS agents, no matter how experienced, have no real idea of what is in it.....and if you call them with a complicated question, you will get passed from agent to agent, on to their legal department, and then be told do whatever you think is best, because they really don't know.

What replaces it is key, and from what I have read of Forbes' original flat tax, even with the deductions and credits it was a gift to the wealthiest Americans. Like I said, it wasn't a true flat tax but a modified flat tax, and still open to interpretation. It also exempted some of the greatest sources of income for the wealthy. Basically is is a flat tax on wages, not income, and that can open up a whole new can of worms. How income is reported, and what is reported as income has always been a great way to avoid taxes, the flat tax on wages opens the door for a lot of abuse on the income of high ranking managers, CEO's etc, the very people who now have the greatest ability to avoid taxes.

If there is even a hint that any new tax reform is advantageous to the wealthy at the expense of the middle class, it will never fly, and the candidate that promotes it will fail with it.

First off this plan obviously isn't at the expense of the lower or middle class with the lowering of the taxes from 25-17 and still giving them bigger child and personal deductions. And second, ANY flat tax unless it it over 33% is going to lower taxes on the wealthy. 17 will be less than any of the middle to top brackets, so that is a given and can't really be used in an argument. But it will also close loopholes making them pay probably the same if not more overall.