I was going to complete my posts on federal finance with a discussion of the national debt, but it turns out that the Federal Reserve��s Z1 data for 2011 will be released on March 8th, allowing me to extend an important part of the discussion �C the part concerning total U.S. debts including state and local government, consumers and the private sector�C by one more year. So instead I��ve decided to once again check in on two Brooklyn fictional couples: the Young Hopefuls, both age 32 with a six-year-old child and a newborn, and the Senior Voters, now both age 72. How do their circumstances and taxes differ?
The Presidential campaign has shined a spotlight on the inequities in the federal tax code, with wealthy former private equity executive and current candidate Mitt Romney paying a far lower share of his income in federal taxes than most middle-income workers. Between growing tax inequities, less restrictive regulations leading to an era of legalized fraud, and corporate bailouts, Sac lancel Roll'N Rock it has become clear that the so-called one-percent rule the federal government in Washington. But who rules state and local government, where the serfs �C and particularly the young �C are paying even NBA Beats By Dre less attention? In New York that is clear as well: senior citizens, particularly retired and soon to retire public employees. The fictional Senior Voters are such retired public employees, and they are on the way to having a ��retirement�� that lasts as long as �C or if they are lucky longer than -- they worked. The Young Hopefuls, in contrast, may face poverty in old age, as they (like most younger private sector workers) do not have any employer-provided retirement benefits, and their federal old age benefits are being encumbered by the soaring federal debt. But how are they faring now? Let��s fire up the Turbo Tax and find out.
In 2007, when I first compared the taxes and circumstances of these two couples, each had an income of $100,000, with the Young Hopefuls paying $33,028 in federal, state and local taxes and the Senior Voters $14,169 on the very same cash income, even though the senior citizen couple in this example had far more wealth and non-cash benefits such as Medicare and employer-financed retiree health care.
Things got worse for the Young Hopefuls in 2008 as the recession caused Ms. Hopeful to be laid off from here moderate income job and Mr. Hopeful��s self employment income to drop, while the Senior Voters, who are ��living on fixed incomes�� benefitted from automatic inflation adjustments for their Social Security and pensions. The Senior Voters paid $13,453 in federal, state and local income and property taxes on their income of $102,,593, or 13.1% of it. Beats By Dre Studio 2013 The Young Hopefuls paid more taxes -- $16,,070, on their far lower income of just $57,000, or 32.1% of it.
The recession continued to affect the Young Hopefuls in 2009, while the Senior Voters�� income increased $104,485, due mostly to a big 5.8% inflation adjustment of Social Security. The Senior Voters paid $15,351 in income and property taxes on their income of $104,485, or 14.7% of it. The Young Hopefuls paid $14,823 on their far lower income of just $57,000, or 26.0% of it.
One of my dilemmas with regard to Room Eight is whether to go on repeating myself. On the one hand, anyone who read all my posts starting in 2006, and downloaded and examined all the spreadsheets, probably now knows about as much about public policy as I do. With not much changing from year to year, repeating the same information would be a waste of my time and theirs. So I write less than I used to, and skipped redoing the taxes and researching the scenarios for 2010. On the other hand, certain facts, such as the ones described here, are considered not worth mentioning by the MSM, the politicians, the people with power, the people who have become better off at other, particularly younger, people��s expense. The worst deceptions are in the unsaid, not the said. There are a lot of people who would prefer that the facts be silenced, so the propaganda of those who pay can TF set the agenda. So let��s see what��s up in 2011.
The Senior leopard Beats By Dre Voters really have been on fixed incomes with regard to Social Security for the past Sac lancel Easy Flirt two years. Based on a quirk in how the cost of living increase for this program is calculated and purple Beats By Dre volatile energy prices, they got that Nike Mercurial Vapor TF huge increase in 2009 and nothing in 2010 and 2011; the 2012 increase will be Beats By Dre Mini Studio 3.6%. In another quirk, however, and one less likely to be an accident, New York��s pensions get a 1.0% cost of living increase every year,, even if the Nike Soccer Boots cost of living doesn��t go up, so their pension income increased slightly more than 2.0% (due to compounding). For simplicity��s MLB Beats By Dre sake, I��ll assume they increased their 457 plan withdrawal by the same amount. Thus, the Senior Voters, a couple of ��senior citizens on fixed incomes,�� had a total income of $105,910 in 2011, up from $100,000 in 2007. That is a 5.9% increase in a period when the Consumer Price index rose Adidas Soccer Boots by 8.7%.
Like others relying on investment income, the Senior Voters have been affected by the Federal Reserve��s zero percent interest rate policy, intended to restore the financial sector to health by redistributing income from savers to banks. With little or no interest income their 457 plan withdrawals have reduced their savings by about $100,000 in the past three years, though they still have more than $500,000 left. Nike Mercurial Vapor AG On the other hand, the financial bailouts and the growing preference for urban living seem to have prevented the value Sac lancel Zéphir of their house from falling back to pre-housing bubble levels, allowing them to cash out $1 million if they decide to move to Florida. The Young Hopefuls could never afford that. It is unclear to me who actually can.
The Senior Voters had some property tax-related setbacks during the recession. The Son of Star checks were eliminated and the NYC property tax rate was increased by (I believe) 7.0%. The assessed value of their home is far less that its real value,, under an early 1980s deal to reduce taxes on homeowners relative to renters and businesses, but it increases by about 4.0% Beats By Dre Tour per year. The Senior Voters�� property taxes are thus up to $4,138 per year. NYC water and sewer charges increased 46.0% Pink Beats By Dre in the past three years due to the growing burden of related debts, in this Lamborghini Beats By Dre case debts incurred for actual capital improvements, Spiderman Beats By Dre increasing their cost to $684 per year, and their home insurance cost was increased to $1,800 due to hurricane related surcharges. On the other hand, warmer weather and lower gas prices provided a break in Superman Beats By Dre 2011. Altogether their paid off $1,500-square-foot home with finished basement costs the Senior Voters $8,723 in property taxes and operating costs, or $727 per month. This does not include the cost of electricity and phone service, since the Young Hopefuls also pay that directly.
In case you haven��t heard, and perhaps haven��t noticed, the recession is over, and New York City has come closer to recapturing the jobs it lost than most metro areas. Therefore the former self employed plumber Mr. Hopeful was able to get a job at a Home Depot, while the former college-educated store clerk Ms. Hopeful got a job as a waitress. They had tried to apply for government jobs but the city isn��t hiring, because of the soaring costs of pensions for older generations after a series of unfunded retroactive enhancements. Ironically the one of the first such enhancements was a pension incentive in 1995, under which the Senior Voters got to retire years earlier than they had been promised. While both of the Young Hopefuls are working, they have no health Beats By Dre Solo HD insurance or retirement benefits, and are in credit adidas 11Pro card debt from the birth of their second child. That cost them $10,000 out of pocket, even with no pre-natal care. And since reported statistics say that the new jobs that are being created pay 40% less than the jobs lost in recession, their income is just $60,000 compared with $100,000 in 2007.
The Young Hopefuls have other concerns. This is their oldest child��s Mademoiselle Adjani third year in the New York City public schools, since he first enrolled in pre-K. In that time class sizes have risen and programs have been cut. They Ferrari Beats By Dre wonder if there will Lebron James Beats By Dre be pre-K, or even kindergarten, when their newborn reaches age 4. The Young Hopefuls don��t know this, because it isn��t in the interest of Green Beats By Dre people with power to tell them, but New York City��s public school spending per student has soared in the past few years. But most of the additional money has gone to retirement benefits, a result of retroactive pension enhancements granted in the past and not paid for, including a hugely costly one just for teachers in 2008. The city cannot afford to hire new teachers as a result. As for the alternatives, private schools are far beyond their diminished means, and the cost of Catholic School continues to rise and Catholic Schools continue to close, as those schools are caught between the needs of their low-paid teachers and their moderate-income students.
Transit fares have also risen and transit service has been cut, as transit workers have also become richer relative to the Young Hopefuls. Mr. Hopeful has started riding a bike to save money. Every now and then, someone in a car calls him a ��Hipster,,�� probably after reading an article in the New York Post. Rents are also rising, in part due to higher property taxes and water charges for their landlord. The Young Hopefuls paid $1,891 per month for their 600-square-foot one-bedroom apartment, where the Sac lancel Daligramme four of them live, or $22,692 per year. Of that amount, $4,235 is the result of property taxes.
Both the Senior Voters and the Young Hopefuls have thus been affected by the Great Recession. The Senior Voters have lost some property tax perks, but still get a huge break compared with the Young Hopefuls. The Senior Voter��s income has not kept up with inflation, but the Young Hopeful��s income has gone down and their public services have been cut. So what about their taxes?
According to Turbo Tax, the Young Hopefuls only owe $2,194 in federal income taxes, as their taxable income is just $33,600. They benefitted from a $2,000 child tax credit, but surprisingly they still used the standard deduction according to the program, despite the $10,000 out of pocket medical expense and their state and local income taxes. Thanks to the payroll tax cut under the stimulus plan, they paid just $3,300 in payroll taxes. Their employers paid $4,500 in payroll taxes on their behalf, and that tax was probably passed on to them in the form of wages that are lower than they would otherwise be. But just taking their own payments, their federal tax burden was $5,494, or 9.2% of their income. A lower percent of income than Mitt Romney pays,, for a change.
Meanwhile, the Young Hopefuls paid $3,538 in New York State and New York City income taxes, for a total of 5.9% of their income. That includes $2,185 in state income taxes, and $1,385 in local income taxes. If Mr. Hopeful were still self-employed, as he had been when I started doing this analysis, he would have been hit by the MTA payroll tax in 2011, but not in 2012 because Graffiti Beats By Dre of a recent change to exempt income less than Beats By Dre Ibeats $100,000 in payroll. The New York City Unincorporated Business Tax has also been modified in a way that exempts self employment income below $100,000.
Add Kobe Bryant Beats By Dre in the $4,235 in property taxes passed on to them in their rent, Beats By Dr.Dre Wireless and the Young Hopeful��s total state and local tax burden is $7,772 or 13.0% of their income, for a total TF tax burden of $13,267 or 22.1% of income. Net of taxes, housing costs, and the cost of having a baby, they had $18,186 to spend on everything else last year. That $350 adidas Nitrocharge per week had to feed, clothe, transport, and otherwise support four people.
And the Senior Voters? Unlike many developed countries, the U.S. federal government funds its social insurance with a payroll tax that falls only on workers and those who provide jobs, rather than a VAT that falls on consumer spending by workers, and rich people with investment income, and the retired alike. Which is one reason why everyone wants to sell to Americans, but no one wants to employ them. The Senior Voters, however, did have to pay the Beats By Dre Studio federal income tax TF on their $105,910 retirement income and thus, according to Turbo Tax, 79,579 in taxable Beats By Dre Solo HD Mini income. Their federal income tax �C and total federal tax burden -- equals $12,144 according to that program, or 11.5% of income.
In 2011, therefore, the Senior Voters ended up paying a slightly higher share of their $100,000 income in federal taxes than the Young Hopefuls paid, with just $60,000 in income, two children to support and one-sixth of their income going to out of pocket medical expenses. Due mostly to the payroll tax cut. No wonder the Tea Party hates President Obama.
Just L'Angèle as all that retirement income is exempt from the federal payroll tax, so all of the Senior Voters�� Social Security and public employee pension income is exempt from the New York State Income Tax and the New York City income tax. (If the Senior Voters had been private sector workers, Power Beats By Dre they would have owed taxes on non-Social Security retirement income in excess of $20,000, though Social Security would have still been exempt). With their other retirement income coming in below the limit, not only do they owe no state and local Sac lancel Paris Line income taxes, but Turbo Tax claims Lady Gaga Heartbeats they are due a $75 school tax credit from the state. So all they paid in state and local taxes was $4,199, or 4.0% of their income, due to the property tax. Needless to say the senior voters in other parts of New York State,, where there is no local income tax to be exempted from but property taxes are higher, do not fare as well.
Adding it up, the Senior Voters paid $16,343 in federal, state and local taxes last year, or 15.4% of their income, compared with the $13,356 paid by the Young Hopefuls,, or 22.3% of their income. After paying for taxes and housing the Senior Voters had $85,118 for the two of them to spend on everything else, compared with the $18,186 left for the four members of the Hopeful family after taxes, housing and the birth of their child.
The Young Hopefuls do get some breaks by living in New York City, despite their high housing costs. Most American families don��t earn as much as $60,000, given the types of jobs that are Diddy Beats By Dre available today. The Young Hopefuls are too middle class to even qualify for the Earned Income Tax Credit, as more and more American workers do because of falling incomes, adidas Copa the New York Times has reported. Because they live in New York City they Orange Beats By Dre can get around by bicycle, waking and transit rather than paying more to own a car. Net of taxes, housing and transportation, I��ll bet most American families have even less to live on, net, than they do. And for the moment New York City provides a variety of social and cultural events and activities either free or for a modest cost.
But even with regard to mass transit, the Senior Voters get to pay half fares on the subways and buses, despite their higher incomes. The Senior Voters aren��t worried about what will happen to the Young Hopefuls, as their children live elsewhere. That��s why they��ll keep voting for their incumbent state legislators, who are all senior voters themselves, until the day they die, and perhaps even afterward. Meanwhile, when are the Young Hopefuls and those who might care about them going to wake up? Because perhaps if things keep going the way they have been, they��ll be really worse off when they become seniors themselves.Statistik: Verfasst von 6033ewmowd — Mo 21. Jul 2014, 21:48
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