Obama's Claim He Did Not Raise Taxes 'Blatantly False'

President Obama’s assertion on Sunday that he “didn’t raise taxes once” is “blatantly false,” a taxpayer watchdog group says. Obama made the claim in his pre-Super Bowl interview with Fox News host Bill O’Reilly.

According to Americans for Tax Reform (ATR), President Obama has signed into law at least two dozen tax increases. The first one – a federal tobacco tax hike – came just 16 days into his presidency.

ATR says the $1 trillion health care overhaul alone added numerous taxes, including the individual mandate that requires most Americans to purchase health insurance or else pay a fine.

During Sunday’s interview, Bill O’Reilly asked Obama if he is “a man who wants to redistribute wealth,” as The Wall Street Journal has described him. The president denied it, again saying, “I didn't raise taxes once; I lowered taxes over the last two years.”

Responding on Monday, ATR said Obama’s claim of being a net-tax-cutter “rests on the temporary tax relief he has signed into law. “That tax increases Obama has signed into law have invariably been permanent. In fact, Obama signed into law $7 in permanent tax hikes for every $1 in permanent tax cuts,” ATR said.

http://visiontoamerica.org/story/taxpay ... false.html

It you tell the lie often enough and many times, you come to believe the lie.

Well, I think Obama clearly misspoke, though I'm sure you won't agree. I think he was talking about federal income taxes, and those generally have been lowered. And even considering the taxes he's raised, I don't believe most have gone in effect yet (I can only think of a cigarette and tanning bed tax), and lower income tax just might outweigh them anyway.

Here are some examples for lower income tax...

http://www.usatoday.com/money/perfi/taxes/2011-02-07-federal-taxes_N.htm

Some scenarios:

— A married couple with two young children and a combined income of $25,000 will pay no federal income taxes for 2010. Instead, they'll get a payment of $7,085 — up from $6,700 in 2008. The larger payment comes mainly from a more generous Earned Income Tax Credit, which provides subsidies to the working poor. They will also get a $1,000-per-child tax credit. The example illustrates how complicated tax returns can be, even for low-income families, said Kathy Pickering, executive director of The Tax Institute at H&R Block.

— A married couple with two children, including one in college, and a combined income of $50,000 would pay no federal income taxes, instead getting a payment of $734 from the government this year. However, they did better in 2008, when they netted a $1,234 payment from the government. That's because Obama's Making Work Pay credit was worth less to them than the Bush-era economic stimulus payment they received in 2008.

— A single person making $50,000 while paying interest on a student loan would have a 2010 tax bill of $5,325 — down $63 from 2008. The difference is due to an inflation-based increase in the standard deduction and personal exemption.

— A married couple with two children, including one in college, with some modest investments and a combined income of $200,000 will see their federal income tax bill drop $780, to $28,496. Their tax bill is lower than in 2008 largely because itemized deductions are no longer limited for high-income families.

— A wealthy couple with two kids in college, larger investments and a combined income of $1 million will see their taxes drop by $6,740, to $277,699 in 2010. Their tax bill is lower than in 2008 because they were able to defer a larger portion of their income to retirement accounts, and because itemized deductions are no longer limited for high-income families.

Hmm - seems to me that those last two examples would be hit by the 'Alternative Minimum Tax' (AMT) and, if so, then yes, their deductions ARE limited.

ShilohLady wrote: Hmm - seems to me that those last two examples would be hit by the 'Alternative Minimum Tax' (AMT) and, if so, then yes, their deductions ARE limited.

They just might of been. But AMT has been adjusted each year by Congress and I don't think it's hitting any harder now than before. As mentioned in the quote, the examples were done by the Tax Institute at H&R Block.

Anyway, unless you smoke like a chimney, or zap yourself in tanning beds hundreds of times, I don't think federal taxes for individuals have gone up... yet. And I do think Obama was clearly referring to taxes to date, not in the future.

When first introduced in 1969, the Alternative Minimum Tax (AMT) was widely acknowledged to be a "rich man's tax" -- a fallback tax for those wily taxpayers with big incomes and numerous deductibles. But because the AMT has been adjusted for inflation only twice in 30 years, it is now encroaching upon the middle class.

AMT rates start at 26%, rising to 28% at higher income levels. This compares with regular federal tax rates, which start at 10% and step up to 35%. Although the AMT rates may appear to cap out at a lower rate than regular taxes, the AMT calculation allows significantly fewer deductions, making for a potentially bigger bottom-line tax bite. Unlike regular taxes, you cannot claim exemptions for yourself or other dependents, nor may you claim the standard deduction. You also cannot deduct state and local tax, property tax, and a number of other itemized deductions, including your home-equity loan interest, if the loan proceeds are not used for home improvements. Accordingly, the more exemptions and deductions you normally claim, the more likely it is that you'll have an AMT liability.

Certain circumstances and tax items are likely to trigger the AMT:

* If your gross income is above $100,000.
* If you have large numbers of personal exemptions.
* If you have significant itemized deductions for state and local taxes, home equity loan interest, deductible medical expenses, or other miscellaneous deductions.
* If you exercised incentive stock options (ISOs) during the year.
* If you had a large capital gain.
* If you own a business, rental properties, partnership interests, or S corporation stock.

If any of the above apply to you, you should complete the AMT worksheet when preparing your taxes. If you don't, rest assured that the IRS will. And if they find that you owe AMT, they'll add penalties and interest. Worse yet, not paying your AMT liability may trigger an IRS audit.

Source
...so - how has it been adjusted each year???

ShilohLady wrote:

When first introduced in 1969, the Alternative Minimum Tax (AMT) was widely acknowledged to be a "rich man's tax" -- a fallback tax for those wily taxpayers with big incomes and numerous deductibles. But because the AMT has been adjusted for inflation only twice in 30 years...

so - how has it been adjusted each year???

I don't think the AMT has anything to do with this topic because the analysis was done by H&R Block, not me. And AMT is certainly covered in their business and software (I used it last year).

But to answer your question, that information you provided is old. It covered 1969 to 1999 (30 years). Since then, it's been adjusted several more times, and this article suggests it's been done each year since 2001 and that's what I recall too (though I didn't know when the adjustments started)...

http://www.schneiderdowns.com/2010_AMT_Patch

As previously noted, the exemption from the AMT is not indexed for inflation or increased for family size. For 2009, Congress provided an AMT patch (and has done so since 2001) that temporarily raised the exemption to $70,950 for married joint filers and to $46,700 for single taxpayers. This AMT patch expired at the end of 2009. If a new patch is not provided for 2010, the exemption amount will revert to the lower statutory amounts of $45,000 for married taxpayers and to $33,750 for single taxpayers

And the AMT was again adjusted in 2010...

http://www.marketwatch.com/story/tax-changes-to-watch-for-on-your-2010-return-2011-01-28

Plus, Congress extended the alternative-minimum-tax patch, preventing millions of taxpayers from losing access to a number of tax breaks under that parallel system. The AMT exemption amount in 2010 for single filers is $47,450 and for married-filing-jointly filers it’s $72,450.

Again, don't know what this has to do with the subject. But it's still interesting. I've got to assume H&R Block factored this in since they wouldn't be in business if they don't know about the AMT.