Taxes on Tips, Overtime and Social Security

Kraftyheel89 said:
No. Ot could

No, it could actually be set up as a a larger version of handy tax tables that already exist. Completing your taxes would be as simple as finding your filing status and dependants, total income from ALL sources (which must be reported to the IRS), finding your spot on the grid and there is your effective tax rate.

It would require a lot of intelligent number crunching to set up and then adjust every few years. But basically, you would want it to come out to a married family of 5 with total income of 40K paying about 4% Fed tax. Married family of four making 100K paying 15 effective tax. Married childless couple making 500K paying 25%, Married couple making 750K paying 30%, Married couple earning over 1.3MM+ 40%.

Very, very rough estimates. But that is the idea. No exemptions. no writeoffs, different treatment by types of income. The only thing that would have to be excluded is personal capital gains income so as not to crush capital investments in our economy.

This addresses income taxation only. Not wealth taxation or wealth redistribution which is unamerican.
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Well we certainly do not want to tax the income called capital gains-since that is where the REAL $ is
 
Kraftyheel89 said:
It would require a lot of intelligent number crunching to set up and then adjust every few years. But basically, you would want it to come out to a married family of 5 with total income of 40K paying about 4% Fed tax. Married family of four making 100K paying 15 effective tax. Married childless couple making 500K paying 25%, Married couple making 750K paying 30%, Married couple earning over 1.3MM+ 40%.

Very, very rough estimates. But that is the idea. No exemptions. no writeoffs, different treatment by types of income. The only thing that would have to be excluded is personal capital gains income so as not to crush capital investments in our economy.

This addresses income taxation only. Not wealth taxation or wealth redistribution which is unamerican.
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How do you square the bolded statement with the prior two paragraphs advocating for progressive taxation and a preference for capital investment? You're taking money from where you think it ought not be and moving it to where you think it ought to be.
 
mpaer said:
Well we certainly do not want to tax the income called capital gains-since that is where the REAL $ is
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Never said don't tax it. Who would take risks on investments when you could lose, or even if you win you would owe 40% on the gains. That's fantasy land far left "thinking."
 
Since both Harris and Trump have talked about eliminating taxes on tips, NPR had a report a couple of weeks ago and brought in someone from the Brookings Institute. I'm sorry I can't remember the exact numbers, but the general premise was twofold. First, the number of people that rely on tips as a major part of their income was a ridiculously small percentage of the working population. Secondly, the vast majority of those people fall in the tax bracket where they essentially pay no income tax anyway.

They interviewed several people in Las Vegas, since that's where both candidates announced their proposals, including a stripper who said she should be taxed on her tips because it's only fair. Long story short, conclusion was the proposal was little more than pandering to a small segment of the population a policy that would benefit almost no one.
 
bdubunc01 said:
Since both Harris and Trump have talked about eliminating taxes on tips, NPR had a report a couple of weeks ago and brought in someone from the Brookings Institute. I'm sorry I can't remember the exact numbers, but the general premise was twofold. First, the number of people that rely on tips as a major part of their income was a ridiculously small percentage of the working population. Secondly, the vast majority of those people fall in the tax bracket where they essentially pay no income tax anyway.

They interviewed several people in Las Vegas, since that's where both candidates announced their proposals, including a stripper who said she should be taxed on her tips because it's only fair. Long story short, conclusion was the proposal was little more than pandering to a small segment of the population a policy that would benefit almost no one.
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Pandering indeed
 
rodoheel said:
I don’t disagree with you from a policy perspective. I’m just echoing others in saying that excluding tips, specifically, from taxation is not the right way to do it. If anything, it would be raising the income threshold for paying federal tax.

And I might be wrong about this but I don’t think the minimum income threshold would be the amount of the standard deduction - at the very least it would be the standard deduction plus like $11k since that first $11k isn’t taxable. Right?
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I thought that one's gross income minus their standard deduction was their adjusted gross, which is taxable?

The lowest tax bracket is 10% on 0-$11,600.
 
UNCatTech said:
I thought that one's gross income minus their standard deduction was their adjusted gross, which is taxable?

The lowest tax bracket is 10% on 0-$11,600.
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I think you're right. I thought the first XXXX wasn't taxable but just looked it up and looks like you're right. My bad.
 
Kraftyheel89 said:
No. Ot could

No, it could actually be set up as a a larger version of handy tax tables that already exist. Completing your taxes would be as simple as finding your filing status and dependants, total income from ALL sources (which must be reported to the IRS), finding your spot on the grid and there is your effective tax rate.

It would require a lot of intelligent number crunching to set up and then adjust every few years. But basically, you would want it to come out to a married family of 5 with total income of 40K paying about 4% Fed tax. Married family of four making 100K paying 15 effective tax. Married childless couple making 500K paying 25%, Married couple making 750K paying 30%, Married couple earning over 1.3MM+ 40%.

Very, very rough estimates. But that is the idea. No exemptions. no writeoffs, different treatment by types of income. The only thing that would have to be excluded is personal capital gains income so as not to crush capital investments in our economy.

This addresses income taxation only. Not wealth taxation or wealth redistribution which is unamerican.
Click to expand...
That family of 5 making $40K and paying 4% ($1,600) is going to be stone-cold broke eating ramen 1-2 weeks a month…..that’s if the kids are already in grade school AND their state/school system provides free breakfast and free lunch. If the kids are daycare age?
 
How do payroll taxes work for a waiter? Does the business just pay taxes on the salary and the business isn't taxed on tips either?
 
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