As Barbie once said, "Math is hard!" and understanding economics is math. But I think Tom Toles breaks down the essentials here in more ways than one.
There was, indeed, a point when my taxes could have been done on a postcard: I had no income except from a single employer and no kids at home, so I just took the standard deduction and filed a 1040-EZ over the phone.
It was very easy and if you have no kids at home and no additional sources of income and no unusual expenses, you could probably still do the same.
However ... and "however" is generally where simple solutions run into problems ... However, the idea of simplifying income taxes such that people with kids and with expenses that drain their income can also file on a postcard should sound a warning, because it really can't be that simple.
Well, except in the sense of that perennial gag cartoon featuring a mock 1040 in which the bottom line is "How much did you make? Send it to us!"
Jack Ohman offers this explanation, which I like: The middleclass end up upside-down in the water and the poor drown entirely, but the job creators sail off happily, creating jobs, which they never have after a tax cut before but which they will now because in the spirit of "I'm not making this up," the proposal is called "the Tax Cuts and Jobs Act."
So there ya go: Jobs. It's right in the name of the law. So it has to happen or, whatever.
And I believe it will create jobs, for yacht makers and the breeders of polo ponies. And perhaps butlers and nannies.
Even Bob Gorrell -- hardly a raving liberal -- has some doubts about this proposal, which sounds really good until you look beyond what fits on a promotional postcard.
This isn't even a new idea. It's the same tired old plan that David Horsey mocked during the Cheney Administration, which, as you may recall, ended with the economy upside down in the ditch.
The difference being that Clinton had left them with a budget surplus to piss away, while the current plan calls for simply increasing the current deficit. A plan that can fit on a postcard!
I saw some GOP Republican tax guy on Erin Burnett the other night and he sounded like Bush in this cartoon, because, to each of her questions about how the proposed tax reform would take away deductions, his response was that, because the standard deduction is so much higher, they would pay lower taxes.
Which sounds good, and it occurred to me that I might even benefit from this, since the bulk of my deductions are business expenses and so fall over on the Schedule C for self-employment, well before we get to my 1040.
And after that, because I'm self-employed, the cost of my health insurance is also a deduction, which it isn't if you have the misfortune to work for an employer who doesn't offer (and pay for part of) your health insurance.
Let's not forget that, before we even talk about income tax, by killing the federal subsidies and making even Affordable Health Care unaffordable, the GOP has already made a lot of families choose between feeding their families and insuring their health.
Meanwhile, for me and everyone else, the personal deduction for out-of-pocket medical costs is so stingy and unfair that it's hard to get a deduction of any size and still be alive to claim it.
Specifically, if your adjusted gross income is $50,000 and you child runs up $5,005 in medical bills, you can take five bucks off your income. Not off your taxes, just off your income.
Though, right now, the Senate and House are sparring over allowing you to take any deduction at all for medical costs.
Because, of course, you'll do so much better with that higher standard deduction.
How much better?
This analysis goes into some details, and you might want to read the rest, but here's the part you need to know:
Let's say you are single with no dependents, and you have a moderate income. Currently, you get to take the standard deduction ($6,350) and one personal exemption ($4,050). If you are 65 or older, you also get to take an additional standard deduction ($1,250). That adds up to $10,400, or $11,650 if you're over 65.
The Republican plan would replace all these provisions with a single deduction of $12,000 ($24,000 for married couples.) That's a 15% increase — except for seniors, who get a 3% increase.
And then your first dollar of taxable income would be subjected to a 12% tax rate, instead of the current 10%.
In other words, it's not even "bad math." It's just bullshit.
Hope you've got some solid yacht-building skills.
Oh, and, by the way, if you're waiting tables, you'll be glad to know that Dear Leader is reversing Obama's rule and allowing your boss to take your tips and distribute them to everyone who works there in order to avoid paying them more than minimum wage.
So, no matter how well you do your job, no matter how much customers appreciate your service, you'll find your pay essentially capped at $7.25 an hour.
On the bright side, if this makes the dishwasher like you, he might set aside some of the good stuff for you instead of dumping it into the barrel, so you can bring it home to feed your kids.
Still, as Jen Sorensen notes, one must be patriotic and loyal and be willing to sacrifice for our country and its owners.
Making America Great Again, like in the old days ...
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